The U.S. and China have agreed on the framework for a trade deal, both nations say.
President Trump said at a White House event Thursday that Washington and Beijing had signed an agreement on trade, adding that he expects to have a deal with India soon. But Beijing and the White House later referred to the development as an agreement on the framework for a deal.
Commerce Secretary Howard Lutnick told Bloomberg TV the deal was signed earlier this week. Neither Lutnick nor Mr. Trump provided any details about the accord.
“We just signed with China the other day,” the president said.
Lutnick said the deal was “signed and sealed” two days earlier.
Rare earth minerals apparently at centerstage
It was unclear if the latest accord was different from the one Mr. Trump announced two weeks earlier that he said would make it easier for American industries to obtain much-needed needed magnets and rare earth minerals. That pact cleared the way for the trade talks to continue, while the U.S. agreed to stop trying to revoke visas of Chinese nationals on U.S. college campuses.
China’s Commerce Ministry said Friday that the two sides had “further confirmed the details of the framework.” But its statement didn’t explicitly mention U.S. access to rare earths, minerals essential for hi-tech products such as defense equipment, electric vehicles and hard drives. China dominates world production of those minerals.
“China will approve the export applications of controlled items that meet the conditions in accordance with the law. The United States will cancel a series of restrictive measures taken against China accordingly. It is hoped that the United States and China will meet each other halfway,” the ministry said.
The agreement follows initial talks in Geneva in early May that led both sides to postpone massive tariff hikes that were threatening to freeze much trade between the two countries. Later talks in London set a framework for negotiations and the deal mentioned by Mr. Trump appeared to formalize that agreement.
A White House official told CBS News Thursday that the Trump administration and China had “agreed to an additional understanding for a framework to implement the Geneva agreement.”
That clarification came after the Trump announcement of a “deal” at the White House event, at which he urged Republican lawmakers to approve the mammoth tax and budget bill before Congress.
China hasn’t announced any new agreements, but said earlier this week that it was speeding up approvals of exports of rare earths. Beijing’s limits on rare earths exports have been a key point of contention.
The Chinese Commerce Ministry said Thursday that Beijing was accelerating review of export license applications for rare earths and had approved “a certain number of compliant applications.”
Export controls of the minerals apparently eclipsed tariffs in the latest round of trade negotiations between Beijing and Washington after China imposed permit requirements on seven rare earth elements in April, threatening to disrupt production of cars, robots, wind turbines and other high-tech products in the U.S. and around the world.
Fentanyl another key in the trade talks
China also has taken steps recently on the fentanyl issue, announcing last week that it would designate two more substances as precursor chemicals for fentanyl, making them subject to production, transport and export regulations. Mr. Trump has demanded that Beijing do more to stop the flow of such precursor ingredients to Mexican drug cartels, which use them to make fentanyl for sale in the U.S. He imposed 20% tariffs on Chinese imports over the fentanyl issue, the biggest part of current 30% across-the-board taxes on Chinese goods.
The agreement struck in May in Geneva called for both sides to scale back punitive tariff hikes imposed as Mr. Trump escalated his trade war and sharply raised import duties. Some higher tariffs, such as those imposed by Washington related to the trade in fentanyl and duties on aluminum and steel, remain in place.
U.S., China economies both feeling trade disputes effects
The rapidly shifting policies are taking a toll on both of the world’s two largest economies.
The U.S. economy contracted at a 0.5% annual pace from January through March, partly because imports surged as companies and households rushed to buy foreign goods before Mr. Trump could impose tariffs on them.
In China, factory profits sank more than 9% from a year earlier in May, with automakers suffering a large share of that drop. They fell more than 1% year-on-year in January-May.
Mr. Trump and other U.S. officials have indicated they expect to reach trade deals with many other countries, including India.
“We’re going to have deal after deal after deal,” Lutnick said.
