US and China agree to work on extending the deadline for new tariffs in trade talks

Korea Herald

5 days ago

STOCKHOLM (AP) — The United States and China have agreed to work on extending a deadline for new tariffs on each other after two days of trade talks in Stockholm concluded on Tuesday, according to Beijing's top trade official.
The US side says the extension was discussed, but not decided.
China's international trade representative Li Chenggang said the two sides had 'in-depth, candid and constructive' discussions and agreed to work on extending a pause in tariffs beyond an Aug. 12 deadline for a trade deal.
'Both sides are fully aware the importance of maintaining a stable, healthy China-US economic and trade relations,' Li said, without elaborating how the extension would work.
US Treasury Secretary Scott Bessent described the talks as a 'very fulsome two days with the Chinese delegation." He said they touched on US concerns over China's purchase of Iranian oil, supplying Russia with dual-use tech that could be used on the battlefield, and manufacturing goods at a rate beyond what is sustained by global demand.
'We just need to de-risk with certain, strategic industries, whether it's the rare earths, semiconductors, medicines, and we talked about what we could do together to get into balance within the relationship,' Bessent said.
He stressed that the US seeks to restore domestic manufacturing, secure purchase agreements of US agricultural and energy products, and reduce trade deficits.
The latest round of talks opened Monday in Stockholm to try to break a logjam over tariffs that have skewed the pivotal commercial ties between the world's two largest economies.
The two sides previously met in Geneva and London to address specific issues — triple-digit tariffs that amounted to a trade embargo and export controls on critical products — China's chokehold on rare earth magnets, and US restrictions on semiconductors.
Monday's discussions lasted nearly five hours behind closed doors at the office of Swedish Prime Minister Ulf Kristersson. Before the talks resumed Tuesday, Kristersson met with Bessent and US Trade Representative Jamieson Greer over breakfast.
The talks in Stockholm unfolded as President Donald Trump is mulling plans to meet Chinese President Xi Jinping, a summit that could be a crucial step toward locking in any major agreements between their two countries.
'I would say before the end of the year,' Trump told reporters aboard Air Force One on Tuesday.
On his Truth Social media platform, Trump insisted late Monday that he was not 'seeking' a summit with Xi, but may go to China at the Chinese leader's invitation, 'which has been extended.
Otherwise, no interest!' Bessent told reporters the summit was not discussed in Stockholm but that they did talk about 'the desire of the two presidents for the trade team and the Treasury team to have trade negotiations with our Chinese counterparts.' Greer said the American team would head back to Washington and 'talk to the president about' the extension of the August deadline and see 'whether that's something that he wants to do.'
The US has struck deals over tariffs with some of its key trading partners — including Britain, Japan and the European Union — since Trump announced earlier in July elevated tariff rates against dozens of countries. China remains perhaps the biggest challenge.
'The Chinese have been very pragmatic,' Greer said in comments posted on social media by his office late Monday. 'We have tensions now, but the fact that we are regularly meeting with them to address these issues gives us a good footing for these negotiations.' Many analysts had expected that the Stockholm talks would result in an extension of current tariff levels, which are far lower than the triple-digit percentage rates proposed as the US-China tariff tiff reached a crescendo in April, sending world markets into a temporary tailspin.
The two sides backed off the brink during bilateral talks in Geneva in May and agreed to a 90-day pause — which ends Aug. 12 — of those sky-high levels. They currently stand at US tariffs of 30 percent on Chinese goods, and China's 10 percent tariff on US products.
While China has offered few specifics of its goals in the Stockholm talks, Bessent has suggested that the situation has stabilized to the point that Beijing and Washington can start looking toward longer-term balance between their economies.
Since China vaulted into the global trading system more than two decades ago, Washington has sought to press Beijing to encourage more consumption at home and offer greater market access to foreign, including American-made goods.
Wendy Cutler, a former US trade negotiator and now vice president at the Asia Society Policy Institute, said Trump's team would today face challenges from 'a large and confident partner that is more than willing to retaliate against US interests.'
Rollover of tariff rates 'should be the easy part,' she said, warning that Beijing has learned lessons since the first Trump administration and 'will not buy into a one-sided deal this time around.'
Bessent said the 'overall tone of the meetings was very constructive" while Li said the two sides agreed in Stockholm to keep close contact and to 'communicate with each other in a timely manner on trade and economic issues.' On Monday, police cordoned off a security zone along Stockholm's vast waterfront as rubbernecking tourists and locals sought a glimpse of the top-tier officials through a phalanx of TV news cameras lined up behind metal barriers.
Flagpoles at the prime minister's office were festooned with the American and Chinese flags.