In a significant development for global trade, the United States and China have reached an agreement to lower tariffs on each other’s goods, providing temporary but crucial relief to businesses and consumers affected by their recent trade war. The agreement, reached after intense negotiations in Geneva, involves a sharp reduction in tariffs for 90 days, giving both nations time to pursue further negotiations without immediately escalating their trade conflict.
What Changed in the Agreement?
- US tariffs on Chinese goods: Reduced from 145% to 30%.
- China’s tariffs on US goods: Reduced from 125% to 10%.
- 90-day pause: Both sides have committed to halting further tariff increases during this period.
A Turning Point in US-China Trade Relations
The agreement was announced by US Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer, who confirmed that the new arrangement also establishes a mechanism for continued dialogue between the two nations. This mechanism is intended to create space for both sides to work towards a more comprehensive and lasting trade agreement.
Chinese media described the deal as a step towards better economic and trade consultations, while President Donald Trump hailed it as a “total reset negotiated.” This temporary truce offers relief not just for the two countries but for global supply chains that have been heavily impacted by their ongoing trade tensions.
Understanding the 90-Day Period
The 90-day period is essentially a cooling-off phase in which both nations have agreed not to introduce any new tariffs or escalate existing trade measures. The reduced tariffs (30% for the US and 10% for China) are temporary, and their duration will depend on the progress of continued negotiations.
This truce also comes with a commitment to continued dialogue. Both countries have set up a consultation mechanism to address their trade issues, offering a diplomatic channel to avoid further disputes. This is a significant change from the hostile exchanges that defined much of their previous interactions.
Implications for Global Trade and Supply Chains
The US-China trade war has been a source of uncertainty for global trade, with companies in both countries and around the world facing higher costs and disrupted supply chains. The latest agreement offers some relief, but businesses must remain vigilant. The 90-day period is a temporary measure, and the risk of renewed tensions remains if negotiations do not lead to a more stable agreement.
Conclusion
While the US and China have made a major step towards de-escalation, the road ahead is uncertain. For businesses involved in international trade, including our Beckchoice customers, staying informed and adaptable is essential.
We are closely monitoring developments and remain committed to supporting our customers through any market changes. Stay tuned for updates as this situation evolves.
The information in this blog is accurate as of 6 May 2025. Conditions related to the US-China trade agreement may change over time. For the latest updates, please contact the Beckchoice Team directly.