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The United States and China have reached a landmark agreement to reduce reciprocal tariffs by 115 percent, bringing duties down to a baseline rate of 10%, following months of escalating trade tensions.
US Treasury Secretary Scott Bessent announced the deal at a press conference in Geneva on Monday, confirming that both nations would enter a 90-day pause on additional trade measures as they work toward a longer-term framework for economic cooperation.
“Both sides showed great respect… We both have an interest in balanced trade,” said Bessent. “The US will continue moving in that direction.”
Background: April Trade Escalation
The agreement reverses a sharp escalation that began in April when the United States, under President Donald Trump, imposed up to 125% tariffs on Chinese goods. In response, China levied similar retaliatory tariffs, creating a “de facto blockade,” according to US Trade Representative Jamieson Greer.
Greer, also speaking at the Geneva event, noted the US trade deficit with China had ballooned to $1.2 trillion by the end of 2024, a 42% increase over prior years.
Key Terms of the Agreement
- Tariffs reduced from 125% ➝ 10%
- China suspends 24% in additional duties for 90 days
- Mutual pause on new trade measures for 90 days
- Renewed talks focused on market access and trade deficit
- Priority: Rebuilding trust and restoring dialogue
Bessent stressed that the US seeks greater market access in China as a condition for expanding trade further, calling the tariff rollback “a reset point” rather than a conclusion.
Strategic Outlook
This dramatic tariff reduction could ease inflationary pressures, reinvigorate US exports to China, and start a thaw in US-China economic relations following years of strained diplomacy. However, the 90-day pause suggests that structural trade, access, and deficit management issuesremain unresolved.
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