US-China Strike Framework Deal to Ease Export Curbs, Maintain Tariff Truce

After tense talks in London, both sides agree to resolve rare earth restrictions and keep punitive tariffs at bay — but long-term trade differences remain unresolved.

London, June 11, 2025 —
In a significant step toward de-escalating trade tensions, the United States and China have agreed on a framework to revive their fragile tariff truce and resolve disputes over export curbs on critical materials. The announcement followed two days of high-level negotiations in London, with officials from both countries signaling cautious optimism.

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The framework builds on a Geneva agreement from last month, which had begun to unravel over China’s restrictions on rare earth mineral exports — vital components for electronics and electric vehicles. In response to those curbs, the Trump administration had imposed export controls on semiconductor design software, aviation equipment, and chemicals.

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🔁 Key Outcomes of the Deal:

• China’s rare earth export curbs will be lifted.
• Some US export restrictions will be rolled back in a “balanced” manner, pending final approval.
• Tariffs will remain suspended until August 10, giving both sides time to negotiate a more comprehensive deal.
• Presidents Trump and Xi Jinping must now approve the framework before it is implemented.

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🗣️ Statements from Negotiators

US Commerce Secretary Howard Lutnick said:

“We have reached a framework to implement the Geneva consensus and the call between the two presidents. The idea is to secure their approval next.”

China’s Vice Commerce Minister Li Chenggang echoed the sentiment:

“The two sides have, in principle, reached a framework for implementing the consensus from the June 5 phone call and Geneva talks.”

However, observers remain cautious. Josh Lipsky of the Atlantic Council noted,

“They are back to square one — but that’s better than square zero.”

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📈 Tariff Timelines & Risks

Without a broader agreement by August 10, suspended tariffs will snap back sharply:

• US tariffs: from ~30% to 145%
• Chinese tariffs: from 10% to 125%

The latest data already shows strain: China’s exports to the US fell by 34.5% in May, the steepest decline since the COVID-19 pandemic.

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🔍 Market & Global Reactions

• MSCI Asia-Pacific index rose 0.2% on Wednesday.
• Analysts urge caution, as details on exact trade volumes and relief timelines remain unclear.
• Gold prices dipped, and the US dollar held steady amid cautious optimism.

Chris Weston, head of research at Pepperstone, said:

“The headlines are constructive, but the devil lies in the details. Investors have seen this movie before.”

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⚙️ Strategic Stakes

• Rare Earths: China controls the majority of global production. These materials are critical for electric vehicles, military hardware, and electronics.
• US Tech Exports: The rollback of curbs on semiconductors and aviation parts is seen as a concession to China, with possible impacts on global supply chains.

The World Bank has already revised its global growth forecast for 2025 downward to 2.3%, citing “heightened trade uncertainty” as a major drag.

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📞 Presidential Diplomacy

The London talks gained traction after a rare direct call between President Trump and President Xi last week, which helped align directives with the Geneva framework.

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Tags:

US-China trade deal, Trump tariffs, rare earth minerals, export restrictions, trade truce, Howard Lutnick, Xi Jinping, global supply chains, semiconductor trade, US commerce, China exports