China & US to Slash Tariffs in Major Trade Breakthrough

Trade war armistice?

By Billy Jiang

In a surprising move that could ease tensions across global markets, China and the United States have agreed to drastically roll back tariffs on each other's goods for an initial 90-day period.

Announced after marathon negotiations in Geneva, the breakthrough marks a major de-escalation of the trade war between the world's two largest economies.

According to the official joint statement released today, the US will lower its tariffs on Chinese goods from a steep 145% to 30%, while China will cut its duties on American imports from 125% to 10%. 

These adjustments are expected to take effect by May 14, 2025.

Beyond the tariff reductions, both sides also agreed to set up a new mechanism for ongoing discussions on economic and trade relations, led by Chinese Vice Premier He Lifeng, US Treasury Secretary Scott Bessent, and US Trade Representative Jamieson Greer.

The move comes at a critical time as businesses and supply chains on both sides of the Pacific were beginning to feel the strain of heightened duties, compounded by inflationary pressures and a cautious global economy.

While this agreement provides temporary relief, it remains to be seen whether the next 90 days will lead to a more durable resolution, or is merely a pause in an ongoing cycle of disputes.

Here's the full English translation of the China-US Joint Statement on Economic and Trade Meeting in Geneva:

Joint Statement on China-US Economic & Trade Meeting in Geneva

The Government of the People's Republic of China ("China") and the Government of the United States of America (the "United States"),

Recognizing the importance of their bilateral economic and trade relationship to both countries and the global economy;

Recognizing the importance of a sustainable, long-term, and mutually beneficial economic and trade relationship;

Reflecting on their recent discussions and believing that continued discussions have the potential to address the concerns of each side in their economic and trade relationship; and

Moving forward in the spirit of mutual opening, continued communication, cooperation, and mutual respect;

The Parties commit to take the following actions by May 14, 2025:

• The United States will (i) modify the application of the additional ad valorem rate of duty on articles of China (including articles of the Hong Kong Special Administrative Region and the Macau Special Administrative Region) set forth in Executive Order 14257 of April 2, 2025, by suspending 24 percentage points of that rate for an initial period of 90 days, while retaining the remaining ad valorem rate of 10 percent on those articles pursuant to the terms of said Order; and (ii) removing the modified additional ad valorem rates of duty on those articles imposed by Executive Order 14259 of April 8, 2025 and Executive Order 14266 of April 9, 2025.

• China will (i) modify accordingly the application of the additional ad valorem rate of duty on articles of the United States set forth in Announcement of the Customs Tariff Commission of the State Council No. 4 of 2025, by suspending 24 percentage points of that rate for an initial period of 90 days, while retaining the remaining additional ad valorem rate of 10 percent on those articles, and removing the modified additional ad valorem rates of duty on those articles imposed by Announcement of the Customs Tariff Commission of the State Council No. 5 of 2025 and Announcement of the Customs Tariff Commission of the State Council No. 6 of 2025; and (ii) adopt all necessary administrative measures to suspend or remove the non-tariff countermeasures taken against the United States since April 2, 2025.

After taking the aforementioned actions, the Parties will establish a mechanism to continue discussions about economic and trade relations.

The representative from the Chinese side for these discussions will be He Lifeng, Vice-Premier of the State Council, and the representatives from the US side will be Scott Bessent, Secretary of the Treasury, and Jamieson Greer, United States Trade Representative.

These discussions may be conducted alternately in China and the United States, or a third country upon agreement of the Parties.

As required, the two sides may conduct working-level consultations on relevant economic and trade issues.

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[Cover image via That's]

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