US-China Trade Talks: Tariff Truce Extension Hinges on Trump's Approval
Published 29 July 2025
Highlights
- US and China have agreed in principle to extend their tariff truce, pending President Trump's approval.
- The current truce, established in May, is set to expire on August 12, risking a return to escalating tariffs.
- US Treasury Secretary Scott Bessent emphasized that any extension requires Trump's final decision.
- Trade negotiations in Stockholm addressed issues like rare earth metals and China's dealings with Russia.
- The International Monetary Fund raised its global growth forecast, citing reduced trade tensions.
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Rewritten Article
US-China Trade Talks: Tariff Truce Extension Hinges on Trump's Approval
In a bid to stave off escalating trade tensions, the United States and China have tentatively agreed to extend their current tariff truce, though the final decision rests with President Donald Trump. The negotiations, held over two days in Stockholm, Sweden, concluded with both sides acknowledging the need for further discussions to maintain economic stability.
Constructive Talks Amidst Unresolved Issues
The talks, described as "constructive" by both parties, aimed to extend the truce established in May, which is due to expire on August 12. US Treasury Secretary Scott Bessent, who participated in the discussions, stressed that while progress was made, any extension of the truce would ultimately require Trump's approval. "Nothing is agreed until we speak with President Trump," Bessent stated, underscoring the importance of presidential consent in these negotiations.
Key Issues and Economic Implications
The discussions covered a range of contentious topics, including the trade deficit, rare earth metals, and China's economic ties with Russia. Beijing's top trade negotiator, Li Chenggang, highlighted the importance of maintaining a stable US-China economic relationship. Meanwhile, US Trade Representative Jamieson Greer noted that the US is on track to reduce its trade deficit with China by $50 billion this year.
The International Monetary Fund (IMF) has responded to these developments by upgrading its global growth forecast to 3%, up from 2.8% in April, citing the easing of trade tensions as a positive factor. However, the IMF also warned of potential risks if tariff rates rebound.
Broader Trade Context
The US-China trade talks are part of a broader pattern of negotiations involving other countries. President Trump is poised to impose additional tariffs on Mexico and Canada, while Southeast Asian nations are seeking extensions to avoid increased US tariffs. The European Union recently negotiated a reduction in planned tariffs on its exports to the US, illustrating the complex and ongoing nature of global trade discussions.
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Scenario Analysis
As the August 12 deadline approaches, the potential extension of the US-China tariff truce remains uncertain, hinging on President Trump's decision. If the truce is not extended, both countries could see a resurgence of tariffs, further straining their economic relationship and impacting global markets. Experts suggest that continued dialogue and compromise are crucial to avoiding a full-scale trade war.
The outcome of these negotiations could also influence other international trade discussions, as countries closely watch the US-China dynamic. A successful extension might encourage more collaborative approaches in other trade disputes, while a breakdown could lead to increased protectionism and economic uncertainty worldwide.
In a bid to stave off escalating trade tensions, the United States and China have tentatively agreed to extend their current tariff truce, though the final decision rests with President Donald Trump. The negotiations, held over two days in Stockholm, Sweden, concluded with both sides acknowledging the need for further discussions to maintain economic stability.
Constructive Talks Amidst Unresolved Issues
The talks, described as "constructive" by both parties, aimed to extend the truce established in May, which is due to expire on August 12. US Treasury Secretary Scott Bessent, who participated in the discussions, stressed that while progress was made, any extension of the truce would ultimately require Trump's approval. "Nothing is agreed until we speak with President Trump," Bessent stated, underscoring the importance of presidential consent in these negotiations.
Key Issues and Economic Implications
The discussions covered a range of contentious topics, including the trade deficit, rare earth metals, and China's economic ties with Russia. Beijing's top trade negotiator, Li Chenggang, highlighted the importance of maintaining a stable US-China economic relationship. Meanwhile, US Trade Representative Jamieson Greer noted that the US is on track to reduce its trade deficit with China by $50 billion this year.
The International Monetary Fund (IMF) has responded to these developments by upgrading its global growth forecast to 3%, up from 2.8% in April, citing the easing of trade tensions as a positive factor. However, the IMF also warned of potential risks if tariff rates rebound.
Broader Trade Context
The US-China trade talks are part of a broader pattern of negotiations involving other countries. President Trump is poised to impose additional tariffs on Mexico and Canada, while Southeast Asian nations are seeking extensions to avoid increased US tariffs. The European Union recently negotiated a reduction in planned tariffs on its exports to the US, illustrating the complex and ongoing nature of global trade discussions.
What this might mean
As the August 12 deadline approaches, the potential extension of the US-China tariff truce remains uncertain, hinging on President Trump's decision. If the truce is not extended, both countries could see a resurgence of tariffs, further straining their economic relationship and impacting global markets. Experts suggest that continued dialogue and compromise are crucial to avoiding a full-scale trade war.
The outcome of these negotiations could also influence other international trade discussions, as countries closely watch the US-China dynamic. A successful extension might encourage more collaborative approaches in other trade disputes, while a breakdown could lead to increased protectionism and economic uncertainty worldwide.
