China and the US meet in London to smooth out tariff negotiations
Since the ninety-day truce was agreed in Geneva, Beijing and Washington have accused each other of violating the established conditions.
LondonChinese and US trade delegations met in London on Monday to address a series of new conflicts that have shaken bilateral relations and threaten the fragile tariff truce they agreed to On May 13, in Geneva, following an escalation of tariff increases that had been imposed on each other in a escalating trade war, from the call Liberation Day by Donald Trump, when the trade war and the imposition of tariffs on imports began.
The new meeting, which took place at Lancaster House, less than three hundred meters from Buckingham Palace, occurred four days after the President Donald Trump spoke by phone with his Chinese counterpart, Xi Jinping"The call lasted approximately an hour and a half and resulted in very positive conclusions for both countries," Trump said. However, it is unknown tonight whether the new meeting between the two negotiating teams has yielded any positive effects.
In any case, analysts only hope that, at best, the playing field will remain as established in Geneva and the stage will be set for future rounds of talks, with sufficient common ground. The real objective, then, is to reestablish the framework for negotiations. There are only two months left until the end of the 90-day truce that both sides agreed to when they reduced their tariffs. These are very complex talks that cannot be resolved in a few meetings. It's about rebuilding momentum and maintaining it.
Because since they agreed to the truce, both the United States and China have traded heated accusations over restrictions on trade in advanced semiconductors that power artificial intelligence, rare earths—vital to carmakers and other industries—and over possible bans on those industries.
US Commerce Secretary Howard Lutnick, who did not take part in the Geneva meeting, has joined the talks in London. Something that, according to some analysts, suggests at least a willingness by the US to listen to China's concerns about export controls. One area where China has an advantage is in the mining and processing of rare earths, essential not only for the automotive industry but also for a wide range of products, from robots to military equipment.
Since April, the Chinese government has required producers to obtain a license to export seven types of rare earths. The resulting shortage has put automakers around the world, including in the United States, on alert. As supplies dried up, some feared they would have to halt production. Trump, without explicitly mentioning the rare earth issue, lashed out at China on social media: "The bad news is that China, though not surprisingly to some, has totally violated their agreement with us," he wrote on May 30.
The rock on Beijing's belt
On Saturday, the Chinese government indicated that it was addressing these concerns, also expressed by European companies. In a statement, the Ministry of Commerce reported that some applications had already been approved and that "the approval of those that comply with regulations will continue to be strengthened." Indeed, the thorn in Beijing's side when it comes to negotiating tariff reductions with the White House may be the rare earths.
On the other hand, although the issue of student visas is not usually part of trade negotiations, the US announcement that it would begin revoking visas for some Chinese students added a new thorn to the relationship. And the Chinese Ministry of Commerce raised the issue when asked last week about the accusation that China had violated the consensus reached in Geneva. Beijing claimed that the US had breached the agreement by establishing new export control guidelines for AI chips, by banning the sale of chip design software in China, and by announcing that it would revoke visas for Chinese students. "The United States has unilaterally provoked new economic and trade frictions," a statement posted on the ministry's website said.
During the 2023-2024 academic year, more than 270,000 Chinese students studied in the United States. US Secretary of State Marco Rubio had declared on May 28 that the United States "would revoke visas for Chinese students, including those with ties to the Chinese Communist Party or studying in fields deemed critical."