admin Donald Trump has thrown his support behind a newly negotiated US-China trade deal that aims to stabilise rare earth mineral supplies crucial for the American automotive sector. The agreement, reached after two days of talks in London, still requires final approval from Chinese President Xi Jinping. If ratified, it could temporarily ease tensions that have threatened US manufacturing industries dependent on Chinese exports.
Under the terms disclosed, China has agreed to ease its restrictions on the export of rare earth minerals and magnets for a six-month period. These materials are essential for sectors including defense, electronics, and automotive production, which had faced looming shortages after Beijing imposed curbs earlier this year. Trump, writing on his Truth Social platform, hailed the agreement, highlighting that “full magnets and any necessary rare earths will be supplied, upfront, by China.”
Tariffs Reach New High Amid Trade Fragility
While the deal addresses rare earth access, it also locks in a new total tariff level of 55% on Chinese imports. This figure includes a combination of existing duties: a 10% general import tariff, a 20% fentanyl trafficking levy, and a 25% pre-existing tariff on Chinese goods. Despite appearing as a hike from last month’s 30% level, a White House official described the 55% rate as the cumulative effect of Trump’s various tariff measures rather than a fresh escalation.
The agreement also offers concessions to China, including expanded access for Chinese students to US universities. However, many broader trade disputes remain unresolved. According to US Commerce Secretary Howard Lutnick, the London talks built on the framework of an earlier Geneva deal that had stalled over China’s mineral export controls.
The trade breakthrough comes as inflation continues to edge upward, with the US consumer price index rising to 2.4% in May. Trump seized on the data to renew calls for the Federal Reserve to cut interest rates, though economists predict the central bank will hold steady amid ongoing policy uncertainty.
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