US president Donald Trump has announced a reduction in tariffs on Chinese imports from 57% to 47%, following a high-level meeting with China’s president Xi Jinping in South Korea.
Trump agreed to reduce tariffs in Chinese imports in exchange for China agreeing to crack down on fentanyl trading, resume US soybean purchases and lower the blockade on rare earth exports.
Meanwhile, the Chinese president sought an easing of export controls on sensitive US technology, as well as a rollback of US port fees on Chinese vessels, which were initially introduced to combat China’s dominance in ocean freight and shipbuilding.
The two presidents met for their first face-to-face talks since 2019, reaching an agreement ahead of the 10 November deadline. Trump claimed that the negotiations were a “12 out of 10”, noting that tariffs would be reduced by halving the rate on fentanyl precursor drugs from 20% to 10%.
However, Derren Nathan, head of equity research at Hargreaves Lansdown, said further details “were thin on the ground”.
As it currently stands, only Brazil and India are subject to higher tariff rates among the US’ biggest trading partners.
The US president has also teased other deals on the table. On Truth Social, Trump wrote: “China also agreed that they will begin the process of purchasing American energy. In fact, a very large scale transaction may take place concerning the purchase of oil and gas from the great state of Alaska.”
Despite news of softening trade relations between the US and China, the FTSE 100 retreated a little at the open, following its best close of 9,756.14 on 29 October.