US, China eye lower tariffs on $30 billion of goods each in fresh trade framework

The United States and China have agreed to explore lower tariffs on selected goods worth about USD 30 billion each, as Washington and Beijing seek to ease trade tensions following Chinese President Xi Jinping’s visit to the US.Under the arrangement, US exporters could gain better access to the Chinese market for products including agricultural goods and medical devices. American consumers could also benefit from lower tariffs on selected Chinese imports such as household products, toys and other goods.US Trade Representative Jamieson Greer announced the recommendations late Sunday under a new Board of Trade created after US President Donald Trump’s visit to Beijing in May."As a direct result of the strong relationship between President Trump and President Xi, the United States and China, under the auspices of the new Board of Trade, have recommended USD 30 billion of trade in non-sensitive goods on each side that could benefit from more favourable tariff treatment in the future,” Greer said in a statement."From agricultural products to medical devices, President Trump is unlocking improved market access for about 30 per cent of US exports to China, while benefiting consumers with imports from China of household goods, toys, and other products that the United States generally does not import from other countries,” he said.What the new trade arrangement coversThe framework focuses on non-sensitive products that both countries agree could receive lower tariffs. Each side has proposed goods worth roughly USD 30 billion for consideration.The US list currently contains 77 tariff entries. They include plastic tableware, bed and table linen, umbrellas, kitchen appliances, playing cards, sports equipment and Christmas decorations.Any future tariff cuts will still have to go through the domestic legal procedures of both countries before they can take effect.The US Trade Representative said the Trump administration would continue pushing for what it described as fair, balanced and reciprocal trade with China. Washington also wants Beijing to meet its commitments on agricultural and energy purchases.New mechanism to manage tradeThe Board of Trade is intended to provide a regular channel for discussions over the selected products and their tariff treatment.Its US principals are treasury secretary Scott Bessent and Greer, while China is represented by Vice Premier He Lifeng.Deputies from both countries worked on the proposed product lists and will oversee trade involving the selected goods. They are expected to meet at least once every quarter and can recommend changes to the lists.However, the terms of reference say the two governments do not expect to make changes more than once a year.Xi’s US visitThe announcement followed Xi’s three-day visit to the US, which began on Wednesday with Trump giving him a rare welcome at the aircraft.The two leaders held talks at the White House for more than two hours on Thursday before attending a state dinner hosted by Trump in Xi’s honour.A Chinese readout said the economic and trade teams had reached a new joint arrangement, describing it as positive for businesses and people in both countries as well as the wider global economy.The latest framework does not automatically reduce tariffs. Instead, it sets out a process through which Washington and Beijing can identify specific goods for potentially more favourable tariff treatment.You use AI every day. Now get your AI Quotient. Take the AIQ test.