Trump Administration and China Agree to 90-Day Pause on Tariffs Amid Ongoing Trade Negotiations

President Donald Trump announced a 90-day pause on tariffs with China in a bid to deescalate a trade war that has rattled global markets and stoked economic anxieties among Americans. The agreement, reached after two days of negotiations in Geneva, will see U.S. tariffs on Chinese imports reduced to 10% from 125% for 90 days. In turn, the Chinese government has agreed to reduce its retaliatory tariffs on U.S. exports for 90 days from 125% to 10%.

Key Takeaways:

• The Trump administration and China have agreed to a 90-day pause on tariffs, reducing U.S. tariffs on Chinese imports to 10% for 90 days, and Chinese retaliatory tariffs to 10% for 90 days.
• The deal will not apply to universal 25% tariffs imposed on automobiles, auto parts, steel, and aluminum.
• Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer played key roles in negotiating the agreement.
• Trump's decision to pause tariffs marks a second time he has backed off from more sweeping levies on imports.
• The deal aims to establish a China-U.S. economic and trade consultation mechanism to guide future talks.
• The U.S.-China trade imbalance, which has decimated U.S. manufacturing, remains a major point of contention.

Statistics:

• $600 billion: The annual trade between the U.S. and China that was virtually halted by the massive tariffs from both countries.
• $300 billion: The amount of goods China exported into the U.S. annually, more than it imported, contributing to a $1.2 trillion U.S. trade deficit.
• 25%: The universal tariffs imposed on automobiles, auto parts, steel, and aluminum, which are excluded from the 90-day pause.
• 10%: The reduced tariff rates for U.S. imports and exports for 90 days under the agreement.
• 90 days: The duration of the tariff pause, which Trump has warned will be followed by further increases if no long-term agreement is reached.

Sources:

• Joey Garrison, USA TODAY WASHINGTON (May 12, 2023)
• Various unnamed sources within the Trump administration and Chinese government.