The U.S. and China on Friday said they have agreed on the framework for a trade deal.
The accord seeks to ease tech restrictions and allow rare earth exports, according to a statement from China’s Ministry of Commerce.
“China will approve the export applications of controlled items that meet the conditions in accordance with the law. The United States will cancel a series of restrictive measures taken against China accordingly. It is hoped that the United States and China will meet each other halfway,” the ministry said.
Presumably, the agreement would make it easier for American industries to obtain much-needed magnets and rare earth mineralsย essential for high-tech products such as hard drives, electric vehicles, and defense equipment. China dominates world production of those minerals. (On Thursday, the Chinese Commerce Ministry said Beijing was accelerating review of export license applications for rare earths and had approved “a certain number of compliant applications.”)
The statement came a day after President Donald Trump said at White House event that “we just signed with China yesterday.” (He also said he expected a deal with India soon.)
“We’re going to have deal after deal after deal,” Commerce Secretary Howard Lutnick said, hinting at trade agreements with at least 10 countries.
Friday’s agreement comes after the U.S. and China agreed in Geneva in May to delay massive tariff hikes that threatened to paralyze trade between both countries and wreak havoc on tech and other industries. Subsequent negotiations in London established a framework for talks.
Silicon Valley, the Beltway, and all parts in between collectively exhaled at the prospect of a trade deal after months of frenzied contingency plans and reshuffled strategies to cope with rising costs and supply chain disruption.
Saber rattling over tariffs and other trade impasses had taken a toll in recent months on the world’s two biggest economies.
The U.S. economy contracted at a 0.5% annual pace from January through March in part because imports surged as companies and households rushed to buy foreign goods before Trump could impose tariffs on them. In China, factory profits slumped more than 9% from a year earlier in May, with automakers suffering the brunt of the decline.
