President Donald Trump declared a new trade agreement with China "done" on Wednesday, framing it as a breakthrough on tariffs, rare earths, and educational exchanges. However, Chinese officials characterized the result as a preliminary framework rather than a finalized deal, underscoring the unresolved tensions between the two economic superpowers.
"Our deal with China is done, subject to final approval with President Xi and me," Trump posted on Truth Social following two days of intensive negotiations in London. He added, "Full magnets and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me!)."
China's Ministry of Commerce took a more cautious tone. A spokesperson described the meetings as the "first" in a series of follow-ups to a broader consensus reached in Geneva last month and stated that a "framework" had been achieved. "New progress was also made in addressing each side's trade concerns," the spokesperson said, offering few details.
Commerce Secretary Howard Lutnick echoed Trump's enthusiasm but confirmed the arrangement remains a framework. "The two largest economies in the world have reached a handshake for framework," Lutnick said. "Once that's done, we will be back on the phone together and we will begin to implement this agreement."
The framework includes the easing of Chinese export restrictions on rare earth minerals-critical inputs for U.S. defense and tech industries-and a fixed 55% tariff rate on Chinese imports to the U.S., according to the White House. That figure comprises:
- A 10% baseline "reciprocal" tariff on all U.S. trading partners
- A 20% penalty on imports from China, Mexico, and Canada related to fentanyl trafficking accusations
- A 25% tariff imposed during Trump's first term on Chinese goods
Lutnick confirmed the tariff rate is permanent: "You can definitely say that," he said in an interview with CNBC.
Still, questions remain over implementation and reciprocity. Treasury Secretary Scott Bessent told lawmakers that no U.S. concessions were made on high-end AI chip exports. "There is no quid pro quo in terms of chips for rare earths," Bessent said during a Senate Appropriations subcommittee hearing.
In London, U.S. negotiators sought to salvage a fragile Geneva truce that had been threatened by China's continued curbs on mineral exports and the U.S.'s tightening of semiconductor restrictions. Talks resumed after a direct call between Trump and Chinese President Xi Jinping broke a weeks-long impasse.
"We have reached a framework to implement the Geneva consensus and the call between the two presidents," Lutnick said. He indicated both sides will now seek final approval from their respective leaders.
Li Chenggang, China's vice commerce minister, offered a parallel message, stating the framework "had been reached in principle" and would be presented to Beijing for review.
Market reaction was muted, reflecting skepticism over the durability and specificity of the claimed agreement. "It's a done deal, according to President Trump, but we haven't seen any details," said Oliver Pursche, senior vice president at Wealthspire Advisors. "The devil is in the details."
