US President Donald Trump announced on Thursday that he and Chinese President Xi Jinping reached an agreement to reduce tariffs and stabilize trade relations. The decision followed their face-to-face meeting in Busan, South Korea — their first since 2019.
Trump said the US will lower tariffs on Chinese imports to 47% from 57%, including a reduction in fentanyl-related tariffs to 10% from 20%. In return, Xi pledged to curb the illegal fentanyl trade, resume soybean purchases, and maintain rare earth exports.
“I thought it was an amazing meeting,” Trump told reporters aboard Air Force One, rating it “12 out of 10.”
Global Markets React to Trade Breakthrough
Global markets reacted cautiously to the announcement. Stocks in Asia and Europe fluctuated, while China’s Shanghai Composite Index slipped from a 10-year high. US soybean futures also weakened as traders assessed the implications of the agreement.
Kyle Rodda, a senior analyst at Capital.com, said markets were hoping for the complete removal of fentanyl tariffs, which may explain the muted response.
A Pledge for Stronger Bilateral Ties
The meeting, held on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, lasted nearly two hours. Xi said occasional frictions between major powers were normal but emphasized his willingness to strengthen China-US relations.
Trump confirmed that China would immediately begin purchasing large quantities of American soybeans and other agricultural goods. He also revealed that Beijing will not impose rare earth export controls that had alarmed global industries.
Although both leaders agreed to stabilize trade ties, questions remain about how long the latest détente will hold amid ongoing geopolitical and economic competition.
