US, China seek to extend trade truce with London talks
LONDON: The United States and China are to sit down at the negotiating table in London on Monday to attempt to preserve a fragile truce on trade, despite simmering tensions.
Treasury Secretary Scott Bessent, commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer are leading the US delegation, President Donald Trump announced on Friday.
Chinese Vice Premier He Lifeng -- who led Beijing's negotiating team at previous talks with the United States last month in Geneva -- would also head the team in London, China's foreign ministry announced at the weekend.
"The meeting should go very well," Trump said on his Truth Social platform.
His press secretary, Karoline Leavitt, told Fox News on Sunday: "We want China and the United States to continue moving forward with the agreement that was struck in Geneva."
While the UK government reiterated that it was not involved in the content of the discussions in any way, a spokesperson said: "We are a nation that champions free trade."
UK authorities "have always been clear that a trade war is in nobody's interests, so we welcome these talks," the spokesperson added.
The talks in London come just a few days after Trump and Chinese President Xi Jinping finally held their first publicly announced telephone talks since the Republican returned to the White House.
Trump said the call, which took place on Thursday, had reached a "very positive conclusion."
Xi was quoted by state-run news agency Xinhua as saying that "correcting the course of the big ship of Sino-US relations requires us to steer well and set the direction".
The call came after tensions between the world's two biggest economies soared, with Trump accusing Beijing of violating a tariff de-escalation deal reached in Geneva in mid-May.
"We need China to comply with their side of the deal. And so that's what the trade team will be discussing tomorrow," Leavitt said Sunday.
A key issue in the negotiations will be Beijing's shipments of rare earths -- crucial to a range of goods including electric vehicle batteries and which have been a bone of contention for some time.
"Rare earth shipments from China to the US have slowed since President Trump's 'Liberation Day' tariffs in April," said Kathleen Brooks, research director at trading group XTB.
"The US wants these shipments to be reinstated, while China wants the US to rethink immigration curbs on students, restrictions on access to advanced technology including microchips, and to make it easier for Chinese tech providers to access US consumers," she added.
In April, Trump introduced sweeping worldwide tariffs that targeted China most heavily.
At one point the United States hit China with additional levies of 145 percent on its goods as both sides engaged in tit-for-tat escalation. China's countermeasures on US goods reached 125 percent.
Then in Switzerland, after two days of talks, the two sides agreed to slash their staggeringly high tariffs for 90 days.
But differences have persisted, including over China's restrictions on exporting rare earth minerals.
The impact was reflected in the latest official export data released Monday in Beijing.
Exports to the United States fell 12.7 percent on month in May, with China shipping $28.8 billion worth in goods last month.
This is down from $33 billion in April, according to Beijing's General Administration of Customs.
There is also huge uncertainty around the outcome of other trade disputes. — AFP
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