[CTC] U.S. and China Agree to Revive Trade Talks After Xi and Trump Speak

[Arthur Stamoulis]

https://www.nytimes.com/2025/06/05/world/asia/xi-trump-talks-china-us-trade.html

U.S. and China Agree to Revive Trade Talks After Xi and Trump Speak

*The two leaders spoke by phone on Thursday, following weeks of worsening
tensions between Washington and Beijing.*

China and the United States on Wednesday agreed to hold more trade talks in
hopes of breaking an impasse over tariffs and global supplies of rare earth
minerals, a move that came after the leaders of the two countries had a
“very positive” phone conversation.

President Trump said in a post on Truth Social that his call with Xi
Jinping, China’s top leader, had lasted for around an hour and a half and
had focused entirely on the trade relationship between the two nations,
which has been souring in recent months amid a growing dispute over the
export of critical minerals used in a wide array of industries.

“I just concluded a very good phone call with President Xi, of China,
discussing some of the intricacies of our recently made, and agreed to,
trade deal,” Mr. Trump said. The call, he added, “resulted in a very
positive conclusion for both countries.”

Mr. Trump also implied that the two leaders had resolved issues surrounding
the exports of rare earth minerals that China had recently halted to the
United States, though he did not elaborate. He said his trade team would
meet again soon with Chinese officials, in a yet-to-be-determined location,
and he said that both he and Mr. Xi had invited each other and their
spouses to visit their respective countries.

Chinese state media confirmed the call in a report Thursday, which said
that the exchange had happened at Mr. Trump’s request.

According to the Chinese readout, Mr. Xi called for greater cooperation and
respect between the countries, and welcomed Mr. Trump to visit China. Mr.
Trump and Mr. Xi were last known to have spoken to each other on Jan. 17,
days before Mr. Trump was inaugurated as president.

Mr. Trump said Thursday’s discussion did not touch on matters beyond trade,
including the Russia-Ukraine war and the Iran nuclear negotiations.

The call appeared to signal a thaw in the U.S.-China relationship,
following several weeks of escalating tensions between the superpowers.

The two countries had reached a tentative trade truce in a meeting in
Geneva last month, in which they agreed to roll back tariffs they had
placed on each other earlier this year, and remove other trade barriers.

But in recent weeks, they had each accused the other of violating their
Geneva agreement. China has continued to restrict exports of rare earth
minerals that are essential for U.S. makers of cars, airplanes and defense
goods, while the United States has responded by halting exports of American
technology and a range of industrial products to China. The Trump
administration also proposed a plan to revoke visas for some Chinese
students.

On Wednesday, Mr. Trump wrote on social media that Mr. Xi was “VERY TOUGH,
AND EXTREMELY HARD TO MAKE A DEAL WITH.”

Shortages of the minerals
<https://www.nytimes.com/2025/06/02/business/china-rare-earths-united-states-supplies.html>,
which are used to make powerful industrial magnets, have threatened to
bring some American factories to a standstill, including America’s defense
industry. China dominates the global market for the minerals and views it
as a choke point over the United States.

The White House did not immediately respond to requests for comment.

In early April, Mr. Trump raised U.S. levies on Chinese goods to an
eye-watering minimum rate of 145 percent and China retaliated by increasing
duties on American imports to 125 percent. The tit-for-tat moves
<https://www.nytimes.com/2025/05/12/business/china-us-tariffs.html> had
effectively cut off trade between the countries and raised concerns about a
broader global economic slowdown.

The truce that resulted from the talks saw both sides temporarily reducing
the punishing tariffs they imposed on each other for 90 days while
negotiators sought a longer-term resolution. China also pledged to suspend
or remove what it called “non-tariff countermeasures” it had imposed since
April, though its public statement did not go into specifics. Trump
administration officials said that they had expected China to lift
restrictions on some rare earth exports.

China has said that the rare earth export controls apply to all countries,
not just to the United States. The distinction means that China can argue
that its controls should not be regarded as a countermeasure taken against
the United States.

“The Chinese are reluctant to give up their leverage so easily,” said Yun
Sun, the director of the China program at the Stimson Center in Washington.
“They want to wait and see how things go” with trade negotiations.

Mr. Trump has suggested on several occasions since returning to the White
House that a call or a meeting with Mr. Xi was imminent. While Mr. Trump
would rather speak directly with Mr. Xi, Chinese officials generally favor
hammering out details in advance of any such call or meeting. And Beijing
had been concerned about the possibility that Mr. Trump would embarrass Mr.
Xi during talks, analysts said.

According to Chinese state media Mr. Xi said in the call that it was
important to correct the course of “the big ship” of China-U.S. relations,
which would require leaders to set the right direction and remove all kinds
of “interference and even sabotage.”

China had done its part after the Geneva talks, he said. Now, “The U.S.
side should take a realistic view of the progress made and withdraw its
negative initiatives against China,” he said.

Mr. Xi also appeared to signal that China did not want the two countries to
decouple — saying that the two sides should enhance exchanges including in
diplomacy, trade and economy, military and law enforcement, to “improve
consensus, reduce misunderstanding and strengthen cooperation.”

But he also drew a hard line on Taiwan, the island democracy China claims
as its territory, which counts the U.S. as a top backer. He essentially
warned Mr. Trump that Washington should not let what he called Taiwan
separatists drag the countries into “a dangerous situation of conflict and
confrontation.”

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826
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