Washington, D.C. — On June 11, 2025, the United States and China announced a preliminary trade agreement aimed at easing tariffs and addressing key economic disputes. The framework, pending formal approval from President Donald Trump and Chinese President Xi Jinping, includes provisions for China to resume exports of rare earth minerals to the U.S. and for the U.S. to maintain a cumulative 55% tariff on Chinese goods.
The agreement emerged after two days of high-level negotiations in London, building upon the Geneva consensus reached in May, which had temporarily reduced tariffs and sought to stabilize trade relations. Under the new framework, China will supply rare earth minerals to the U.S. for six months, a critical move given China’s dominance in the global rare earth market.
Rare earth minerals are essential components in various high-tech industries, including electronics, automotive, and defense applications. China controls approximately 90% of the global processing capacity for these minerals, making access to them a strategic priority for the U.S.
In addition to the rare earth provisions, the agreement allows Chinese students continued access to American educational institutions, a shift from previous restrictions. However, the U.S. will maintain a cumulative 55% tariff on Chinese imports, comprising various tariffs imposed over recent years.
U.S. Commerce Secretary Howard Lutnick confirmed that the 55% tariffs on Chinese goods will remain unchanged, despite the new trade deal. He emphasized that the agreement solidifies previously vague terms, especially regarding rare earth mineral exports.
The announcement had immediate economic implications, with U.S. stock futures indicating a decline as investors awaited further details and the release of key inflation data. Analysts expressed cautious optimism, noting that while the agreement marks a significant step toward resolving ongoing trade tensions, its success depends on both parties upholding their commitments.
The tentative accord reflects ongoing efforts by both nations to stabilize economic relations amid broader geopolitical challenges. As the global economy continues to grapple with supply chain disruptions and inflationary pressures, the U.S.-China trade relationship remains a focal point for policymakers and investors alike.