US-China Trade Talks Begin In London Aimed At Easing Export Restrictions
Talks between the US and China have begun in London, with the US signaling a willingness to remove export restrictions in exchange for assurances that China eases restrictions on rare earth shipments.
The meetings, which are set to begin shortly after 1 p.m. local time on Monday, are expected to last into the evening in the U.K. and could extend into Tuesday.
The Trump administration is hoping that “after the handshake” in London, all export controls from the U.S. will be eased and rare earths will be released by China, Kevin Hassett, head of the White House National Economic Council, told CNBC. It was the clearest signal yet that the U.S. is willing to offer such concessions.
The first round of talks since the two teams met a month ago is aimed at restoring confidence that both are living up to commitments made in Geneva. During those discussions, Washington and Beijing agreed to lift crippling tariffs for 90 days to give them time to find ways to address a trade imbalance that the Trump administration has called unfair.
GLOBAL PREVIEW: London Calling - US, China Try to Avoid Clash
Confusion after the Geneva meeting over China’s rare earth export licensing process, combined with US restrictions on technology shipments and Washington’s recent crackdown on Chinese student visas, underscore the complexity of dealmaking between China and the US.
“They’re leaving too much open to interpretation,” said Josh Lipsky, chair of international economics at the Atlantic Council. The US and China “just want to get back to where they were in Switzerland with a few more agreements on paper to really understand what’s going to be licensed, what’s going to be allowed, what’s not going to be allowed,” he added.
A phone call last week between President Donald Trump and his counterpart Xi Jinping appeared to provide new momentum to revive the talks and reach a deal.
Delegation Arrives
On Monday at Lancaster House in London — where former European Central Bank President Mario Draghi delivered his “whatever it takes” speech in 2012 — U.S. Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer will meet with a Chinese delegation led by Vice Premier He Lifeng.
The inclusion of Lutnick, who was in charge of curbs on sales of advanced technology, suggests Trump may be willing to consider rolling back some of the restrictions that threaten to hamper China’s long-term growth ambitions, from technology supplies to jet engine parts.
U.S.-China trade tensions have escalated this year as Trump raised tariffs on Chinese goods, prompting retaliation from Beijing. That has hurt both economies, including distortions in data and uncertainty for businesses trying to navigate the sudden shift in trade policy.
Earlier on Monday, Chinese government figures showed exports rose less than expected last month as the worst drop in shipments to the U.S. in more than five years offset strong demand from other markets.
In the US, job growth slowed in May and prior months were revised lower, suggesting employers are cautious about growth prospects. Trump’s tariffs are causing uncertainty and delays for US manufacturers, particularly in the Midwest, affecting their investment and production plans. (alg)
Source: Bloomberg
