US and China Agree on Plan to Ease Trade Tensions

Officials from the United States and China have agreed on a preliminary plan to reduce trade tensions between the two countries. The agreement, reached during high-level meetings in London, aims to revive the flow of key goods and materials, including rare earth minerals, which are essential to modern technology and manufacturing.

The talks lasted nearly 20 hours over two days at Lancaster House in London. Delegates from both sides confirmed they reached a framework to implement earlier agreements made in Geneva last month. That previous round of discussions led to a temporary pause in tariffs and marked an important step toward reducing trade barriers.

The current proposal will be taken back to the presidents of both countries for final approval. If accepted, the United States is expected to lift certain export restrictions, while China would ease controls on the shipment of rare earth materials.

US Commerce Secretary Howard Lutnick said the plan would help restore a balance in trade. He added that once China resumes shipments of rare earths, the US would begin easing restrictions on items like chip design software and jet engine parts.

Trade Representative Jamieson Greer emphasized that no further meetings are currently scheduled, but both sides remain in regular contact.

Rare earth materials are a central part of this discussion. These minerals are used in a wide range of industries, including electronics, electric vehicles, and defense. China controls a large portion of the global supply, giving it significant leverage in trade negotiations.

The recent talks followed a phone call between US President Donald Trump and Chinese President Xi Jinping. That call helped break a deadlock and led to the London meetings, which were attended by key officials from both countries, including China’s Vice Premier He Lifeng.

Aside from rare earths, the US has also highlighted the need for progress on controlling the supply of fentanyl, a powerful synthetic drug. Officials say this issue remains a priority for the White House.

Although the agreement represents progress, trade experts warn that deeper issues remain. The US and China continue to compete for leadership in critical areas such as semiconductors and energy technology. Analysts say that while this new agreement could improve short-term relations, more negotiations will be needed to resolve long-standing differences.

Markets reacted calmly to the news. US equity futures moved slightly lower, while the offshore Chinese yuan saw a small rise. Investors are now watching for further developments as both governments review the deal.

Officials on both sides said they hope the agreement will build trust and lead to more stable trade relations in the future.