The United States and China have reportedly reached a significant framework agreement that could pave the way for a major trade deal, set to be discussed during high-level talks between their respective leaders later this week. According to Scott Bessent, the US Treasury Secretary, this framework addresses key contentious issues including the future of TikTok’s operations in the United States and adjustments to China’s recent restrictions on rare earth mineral exports. These developments come as both countries aim to de-escalate a prolonged trade conflict that has strained economic relations between the world’s two largest economies.
Bessent shared these updates during an interview with CBS, the BBC’s US news partner, explaining that the framework agreement sets the stage for a “final deal” to be negotiated when President Donald Trump and Chinese President Xi Jinping meet on Thursday in South Korea. The two leaders are expected to discuss the framework in detail during their summit, which is part of a broader diplomatic engagement in the region. Bessent expressed optimism that a 100% tariff on Chinese imports, which Trump had previously threatened to impose, would be avoided, signaling a potential thaw in trade tensions.
The backdrop to these talks includes a series of tariffs and retaliatory measures that have disrupted global supply chains and business confidence. Since Trump’s return to the White House, his administration has pursued an aggressive trade policy aimed at boosting domestic manufacturing and protecting American jobs by imposing tariffs on a range of imports, most notably from China. China responded with its own tariffs and trade barriers, prompting fears of a full-scale trade war. However, both sides have shown a willingness to negotiate and delay the implementation of the harshest levies while seeking a comprehensive trade agreement.
One of the most sensitive issues that had threatened to further inflame tensions was China’s recent tightening of export controls on rare earth minerals. These minerals are critical components in the manufacture of many high-tech products, including smartphones, solar panels, and military equipment. China dominates the global supply chain, processing approximately 90% of the world’s rare earths, making its export policies a powerful negotiating tool. President Trump accused Beijing of using these controls as a form of economic coercion, describing China as “becoming very hostile” and attempting to hold the world “captive.”
In response to these export restrictions, Trump announced plans to impose an additional 100% tariff on Chinese goods starting in November, escalating the trade conflict. However, Bessent revealed that China has agreed to delay the enforcement of these export controls for at least a year while the two countries reassess their trade relationship. This postponement is seen as a significant concession, potentially easing supply concerns for American manufacturers dependent on rare earth materials.
Another major sticking point has been the trade in soybeans, a key agricultural product and one of the largest US exports to China. When trade hostilities escalated, China effectively halted soybean purchases, which dealt a severe blow to American farmers. Bessent, who identifies as a soybean farmer himself, acknowledged the pain this boycott caused but indicated that the issue has been addressed in the new framework. He expressed confidence that the resumption of substantial soybean purchases from China would benefit US farmers, with positive effects expected to materialize in the current and coming seasons. Although specific details were withheld, the implication is that China will soon lift its effective ban, restoring an important market for American agriculture.
The framework also includes provisions related to TikTok, the popular video-sharing app owned by Chinese company ByteDance. The US government had previously demanded the sale of TikTok’s US operations over national security concerns, fearing that the Chinese government could access sensitive user data. TikTok was threatened with a shutdown unless it complied, but the Trump administration has delayed enforcement multiple times to allow for negotiations. The new deal reportedly involves US companies gaining control over TikTok’s algorithm, with American board members holding a majority stake in governance. Bessent indicated that the final agreement on TikTok’s US operations is expected to be finalized by Trump and Xi during their meeting, marking a significant development in the contentious issue.
Beyond the bilateral US-China discussions, the Trump administration has also been engaging with countries in Southeast Asia during a week-long tour of the region. On Sunday, Washington announced a series of trade deals and framework agreements with Malaysia, Cambodia, Thailand, and Vietnam. These nations, which rely heavily on trade with the US, have been impacted by the ripple effects of the US-China trade war and the tariffs imposed by the Trump administration.
While existing tariffs