US-China tariff deal: Trade talks held second day in London; rare earth minerals and AI chips in focus

Time of India

2 days ago

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Trade negotiations between the US and China continue for a second day in London on Tuesday, following US President
Donald Trump
's assessment that while China presents challenges, the US is making progress in the discussions.
At Lancaster House, a prominent 19th-century building situated near Buckingham Palace, the Chinese delegation headed by Vice Premier He Lifeng engaged with US officials including Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer on Monday.
The Chinese representation includes Wang Wentao, the commerce minister, alongside trade negotiator Li Chenggang.
Trump's Monday evening statement to journalists confirmed, "We are doing well with China. China's not easy."
Following their Geneva discussions last month, both nations agreed to pause the implementation of substantial tariffs for 90 days, addressing concerns about potential economic downturn caused by their ongoing trade disputes.
Post-Geneva talks, tensions have risen between the nations regarding AI-capable semiconductors, visa policies for Chinese students in American educational institutions, and the supply of "rare earth" minerals crucial to manufacturing sectors.
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Last Thursday, Trump and Chinese leader
Xi Jinping
conducted an extensive telephone conversation to improve diplomatic relations. Trump subsequently announced via social media that negotiations would commence in London.
As the primary global supplier of rare earths, China has indicated potential relaxation of its April export limitations, which had caused concern among global automotive manufacturers. Simultaneously, Beijing seeks removal of US restrictions on Chinese access to advanced semiconductor technology.
Trump expressed his intention to increase Chinese market access for American products. "If we don't open up China, maybe we won't do anything," Trump said at the White House. "But we want to open up China."
This comes as top US and Chinese officials convened in London on Monday to work on stabilizing the delicate pause in their trade conflict, which has impacted global markets.
The latest round of diplomacy follows a tentative agreement in Geneva last month, where both sides committed to a 90-day pause on the steep tariffs, some over 100%, they had imposed on each other in a tit-for-tat escalation.
The temporary truce, announced on May 12, offered some breathing space, though tensions remain high. Since the Geneva breakthrough, the two nations have had disagreements over advanced semiconductors used in artificial intelligence, visa restrictions for Chinese students in the US, and the export of rare earth minerals, critical raw materials used in electric vehicles and consumer electronics.
The rare earths issue is likely to be a key topic in the London talks, after China began mandating export licenses for producers dealing in seven of these materials in April. The move triggered supply shortages, sending global automakers scrambling and raising fears of production halts.
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