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The White House said that a trade agreement has been concluded with China and is waiting for the signatures of the US President Donald Trump and his Chinese counterpart Xi Jinping.
The White House said on Wednesday that the president is currently checking the details.
Trump announced the deal after days of trade talks between the US and Chinese delegations in London, which followed a previous round of negotiations in Geneva, Switzerland.
“We have reached a framework for the implementation of the Geneva consensus and the call between the two presidents,” said the US Minister of Trade Howard Lutnick during the announcement to reporters.
What is included?
The deal includes a provision in which China is supplied to the USA for large US companies, especially in the automotive, semiconductor and smartphone manufacturing sector.
Trump said minerals were delivered in advance, but it is unclear what that means.
China has disproportionate control over the market for rare earths. It produces 60 percent of rare earth minerals worldwide and processes almost 90 percent of them. This was a long -term concern of the United States, also during the administration of former President Joe Biden.
In February 2024, the then American energy -minded Jennifer Granholm said that the USA was “very concerned” about the nation’s trust in China to provide critical minerals in an interview with CNBC.
These concerns were reinforced in Trump’s second term, especially after it was imposed on China’s chip industries, especially after it was imposed on China’s chip industry.
In April, the Chinese Ministry of Commerce reorganized these minerals by imposing export restrictions.
As part of the latest agreement, the United States will impose 55 percent tariffs on Chinese goods in the course of the Board of Directors of 145 percent. In return, Beijing will impose a 10 percent tariff on the goods imported by the USA that have dropped of 125 percent.
The 55 percent US tariff contains a 10 percent basic tariff -that is currently in legal floating after a commercial court illegal, a decision that a higher court temporarily blocked -as well as 25 percent of tariffs to Trump’s first term and 20 percent in connection with the alleged fentine lybs.
The White House framed the deal as a victory, and the tariffs remain higher than the first time. Experts continue to argue that tariffs as tax for US companies and consumers will ultimately bear the costs and not the China.
“A death sentence”
Retailers, including Walmart, have already announced that they increase prices for the tariffs. In a profit call last month, CEO Doug McMillon said: “In view of the size of the tariffs, even at the reduced level that is announced this week, we cannot put pressure on the reality of the tight retail margins.”
Walmart obtains about 60 percent of his goods from China. It is not clear whether it changes one of his procurement plans in the light of the last deal.
The New Deal has not taken into account the concerns of the small business world.
“For many small companies that mainly receive their parts or products from China, this is a death sentence and will destroy its American dream,” said Main Street Alliance, a representative group that represents the interests of the small businesses, in a publicly published statement in response to the trade agreement.
Small business owners also had to develop settings and break due to tariffs for China. Wild Rye, a brand outdoor clothing that previously spoke to Al Jazeera, said that nothing has changed.
“It is devastating, 55 percent tariffs are still crazy,” said Cassie Abel, founder of Wild Rye, to Al Jazera.
She added that due to the previously announced tariffs, forward -looking expenses and orders for small companies, as it was very difficult, it was very difficult to find shipping containers to bring their existing orders to the USA.
“It is really difficult to find a container. The chances of getting our product out of China within the 90-day window are basically zero,” said Abel.
The deal for a 90 -day break for most tariffs was announced in April and runs on July 8th. Since the details of the trade agreement do not yet have to be published, it is not clear when the new tariffs will occur for China.
The White House did not respond to Al Jazeera’s request for clarification.
The deal also includes a concession that enables Chinese students to continue visiting US universities, a matter that had only been contested a few weeks ago. The sudden shift in US farming, the thousands of Chinese students – and the universities where they should participate or are currently registered – had left the limbo.
Lutnick said that the US tariffs in China will not change again and will come into force in the next week, although analysts believe that this could be a negotiation tactic.
Dan Ives, Analyst at Wedbush Securities, believes that despite Lutnick’s claims, this will not be the end of the collective bargaining with China. He expects further industry -specific exceptions in the coming months, similar to the exception for semiconductor chips.
“The tariffs are high, but I think that’s … a starting point. The frame is determined and I would expect more business in the future,” said Ives.
Adams Hersch, Senior Economist at the Economic Policy Institute, agrees that this will lead to more negotiations.
“It seems that the two sides have agreed to postpone their deeper disagreements,” said Hersch.
Market reaction
The global markets generally responded positively to the news. In London the FTSE closed 0.1 percent. The Nikkei in Tokyo closed by 0.6 percent, the Hong Kong Hang Seng Index rose by 0.8 percent and the Shanghai markets ended the day by 0.5 percent.
In the United States, the markets remained largely flat and balanced the optimism from the trade news with the publication of new inflation data. Consumer prices rose by only 0.1 percent, which was lower than expected. Analysts say that the number reflects both damped inflation and consumers who school back, which is partly due to the uncertainty in terms of trade policy.
The S&P 500 fell by 0.3 percent for four days. Dow Jones’s industrial average remained by 1 point after yesterday. The technical nasdaq fell by 0.5 percent.