US and China Call a Truce: Tariffs Frozen in Landmark Trade Deal

The United States and China have agreed to freeze and roll back partially recently levied tariffs on each other's goods in a landmark deal following two days of top-level trade talks in Geneva. Under the deal, the two nations will freeze 24 percentage points of the additional tariffs already levied on each other's products for the first 90 days. This is to mean that only a 10% ad valorem duty will continue to apply on impacted goods. On top of this, the U.S. will eliminate tariffs described in Executive Orders 14259 and 14266, with China similarly eliminating its retaliatory tariffs.

Aside from suspensions of tariffs, China is also committing to suspend or terminate non-tariff countermeasures introduced after early April 2025. Both countries will set up a new platform of consultation for constant trade talks with top officials who will address greater economic issues. This platform should allow for communications and could hold meetings that will be conducted either in one or both countries or in a neutral venue.

The accord is timely, as rising tariffs had brought considerable disruptions to two-way trade, with U.S. tariffs up to 145% on Chinese goods and China imposing up to 125% on U.S. products. The hiatus is expected to bring instant relief to global markets and supply chains, although long-term implications will depend on subsequent negotiations. In a bid to promote a sustainable trade partnership, representatives from the two nations have described the negotiations as fruitful, indicating the desire to pursue additional economic ties.