Trump and Xi reach trade deal, easing tensions in fierce US-China rivalry

Al Jazeera
Al Jazeera
2M ago
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US President Trump and China's Xi Jinping agreed to a one-year trade truce, easing tensions in their trade war, which is crucial for global economic stability.
Trump and Xi reach trade deal, easing tensions in fierce US-China rivalry
A What happened
On October 30, 2025, US President Donald Trump and Chinese President Xi Jinping announced a one-year trade truce during their meeting at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea. This agreement aims to de-escalate the trade war that has been affecting global economic stability. Key elements of the deal include China deferring its planned export controls on rare earths and the US dropping a proposed 100 percent tariff on Chinese goods. Trump also agreed to reduce a fentanyl-related tariff from 20 percent to 10 percent, contingent on China's commitment to curb fentanyl flows. Despite these concessions, many existing tariffs and trade barriers remain in place, suggesting that significant disagreements persist. Analysts view this agreement as a minor rollback in tensions, with the potential for annual reviews to adjust the terms as needed.
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Key insights

  • 1

    Trade War Eases Temporarily: The agreement provides a temporary pause in escalating trade tensions.

  • 2

    Tariff Reductions: US tariffs on Chinese goods remain high despite some reductions.

  • 3

    Global Economic Impact: The trade truce is crucial for maintaining global economic stability.

Takeaways

While the trade truce between the US and China marks a step towards reducing tensions, many unresolved issues remain, indicating that the trade relationship will continue to be complex and contentious.

Topics

Business & Markets Economy World & Politics Policy & Regulation International Affairs