The United States and China reported significant progress in trade talks in Malaysia. Their announcement fueled optimism about a possible deal this week in South Korea. Negotiators met on the sidelines of the ASEAN Summit and signaled that a framework is ready. President Donald Trump and President Xi Jinping will meet on Thursday during the APEC Summit in Daegu. That meeting will mark Trump’s first face-to-face encounter with Xi since 2019.
US Treasury Secretary Scott Bessent confirmed that both sides crafted a framework for the leaders to discuss in South Korea. The final agreement may include concessions on tariffs and export controls. He said he expects the framework to stop China from enforcing its rare earth export controls. He also said it could block Trump’s threat to impose a 100% tariff on Chinese imports.
Framework Includes Agriculture Boost
Furthermore, Bessent said Beijing agreed to boost US agricultural imports. He noted that American soybean farmers would “feel very good” about the purchases. Chinese Vice Premier He Lifeng also confirmed basic consensus. He stated that teams will finalize details and begin internal approval procedures soon.
Markets React with Confidence
Asian financial markets surged after the progress. Japan’s Nikkei 225 gained 2.1%. South Korea’s KOSPI jumped 2.3%. Hong Kong’s Hang Seng rose 0.85%. Investors welcomed the possibility of easing trade tensions that have disrupted global supply chains.
Tariff Strategy and Rare Earth Pressure
Trump has imposed aggressive tariffs on major trade partners. Yet he focused the harshest actions on China due to trade imbalance concerns. Earlier this month, Beijing announced new export licensing rules for rare earth materials. Trump responded with his tariff threat to pressure China before the summit.
