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The United States and China have reached an understanding on the framework for a potential trade agreement, according to the US treasury secretary, setting the stage for discussions between the two nations’ leaders later this week.
Scott Bessent, speaking to CBS, the BBC’s US news partner, indicated that the framework includes a “final deal” regarding TikTok’s US operations and a postponement of China’s stricter controls on rare earth minerals.
Bessent also conveyed his expectation that the previously threatened 100% tariff on Chinese goods by US President Donald Trump would not be implemented. In return, China is expected to resume significant purchases of soybeans from the US.
Both countries are seeking to de-escalate the ongoing trade dispute between the world’s two largest economies.
President Trump and Chinese President Xi Jinping are scheduled to meet on Thursday in South Korea for bilateral talks.
Bessent engaged with senior Chinese trade officials on the sidelines of the Association of Southeast Asian Nations (Asean) summit in Malaysia, where Trump is also participating as part of his Asia tour. Beijing described the discussions as “constructive.”
Bessent stated that a “substantial framework” had been agreed upon for the two leaders, adding, “The tariffs will be averted.”
The Chinese government released a statement indicating that both negotiating teams had “reached a basic consensus on arrangements to address their respective concerns.”
“Both sides agreed to further finalise specific details,” the statement continued.
Since returning to the White House, President Trump has imposed and threatened broad tariffs on imports from various countries, citing the policy’s potential to bolster US manufacturing and job creation. The implementation of tariffs has prompted several countries, including the UK, to pursue new agreements with the US.
However, the most significant levies have been threatened against China. Beijing has responded with retaliatory measures, although both sides have agreed to suspend the implementation of tariffs while seeking a trade resolution.
Earlier this month, Trump announced his intention to impose an additional 100% tariff on Chinese goods beginning in November, citing China’s tightening of export restrictions on rare earth minerals. These materials are crucial for the production of numerous electronic devices. The US president accused Beijing of “becoming very hostile” and attempting to hold the world “captive.”
China processes approximately 90% of the world’s rare earth minerals, which are essential components in products ranging from solar panels to smartphones, making their supply to US manufacturers a key point of negotiation.
The previous instance of Beijing tightening export controls, following Trump’s increase in tariffs on Chinese goods earlier this year, sparked concerns among US firms heavily reliant on these materials.
Bessent stated on a separate news program, “This Week,” on Sunday, that China will “delay that for a year while they re-examine it.”
Another contentious issue is soybeans, with China being the world’s largest importer. As trade tensions escalated, China halted all orders, impacting US farmers.
Bessent suggested that the boycott may soon end but did not provide specific details.
“I’m actually a soybean farmer, so I have felt this pain too… I think we have addressed the farmers’ concerns,” he said on This Week.
“I believe when the announcement of the deal with China is made public that our soybean farmers will feel really good about what’s going on for this season and the coming seasons for several years.”
Bessent also confirmed that an agreement had been reached regarding the US operations of the video-sharing platform TikTok, with Trump and Xi expected to “consummate that transaction on Thursday.”
The US has sought to separate the app’s US operations from its Chinese parent company, ByteDance, citing national security concerns.
TikTok was previously instructed to sell its US operations or face a potential shutdown. Trump has delayed the implementation of the ban four times to facilitate negotiations and has extended the deadline to December.
The White House announced last month that US companies would control TikTok’s algorithm and Americans would hold six of seven board seats for the app’s US operations.
While Trump initially advocated for a ban on TikTok during his first term, his stance has since shifted. He has utilized the platform to increase his support among young Americans during his successful 2024 presidential campaign.
On Sunday, Washington also announced the securing of trade deals with Malaysia and Cambodia, as well as frameworks with Thailand and Vietnam.
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