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Observer
12 hours ago
- Business
- Observer
China, US ease trade restrictions after deal
China and the United States have agreed to ease some trade restrictions, according to statements from both sides. China's Ministry of Commerce announced on Friday that it will review and approve applications for the export of 'controlled goods' that comply with regulations, while the US would lift a series of 'restrictive measures' against China. US President Donald Trump previously mentioned a signed agreement with China but left many questions unanswered. "We just signed with China yesterday," the Republican said at an event at the White House while talking about making deals with other countries. Trump also suggested that there could 'maybe' be a 'very big' deal with India. US Commerce Secretary Howard Lutnick later confirmed in an interview with financial news agency Bloomberg that the deal with China had been signed. He said China would supply rare earths, while the US will end its countermeasures. Since Trump launched a trade war with Beijing in February, the world's two largest economies have been locked in a tit-for-tat tariff fight that has unnerved global markets. In April, Trump increased tariffs on goods from China to as much as 145 per cent. In response, Beijing imposed counter-tariffs of 125 per cent and introduced export controls on industrially important rare earths and magnets made from them, on which China holds a near-monopoly. At the height of the tariff dispute in May, high-level delegations from both sides agreed in Geneva to significantly reduce tariffs for 90 days while continuing negotiations. It remains unclear, however, what will happen after the August deadline. The US has since imposed further restrictions on the export of important technology, such as software for computer chips and aviation components, for which China still relies on foreign manufacturers. Another meeting between the two sides, in London in early June, focused on the trade restrictions. US representatives eventually agreed with their Chinese counterparts on a reduction, although for a long time no details emerged. Observers interpreted the outcome as a return to the state of play after the Geneva meeting. Both countries' presidents were expected to approve the decisions following the London talks. Beijing's export restrictions on rare earths has put significant pressure on industries outside of China. The measures affected all countries, not just the US. In Germany's important automotive and mechanical engineering sectors, companies are concerned about the supply of important metals used in sensors or electric motors. China justified the controls by stating that the raw materials can have both civilian and military uses. Companies said it was taking along time for China's Ministry of Commerce to process applications, without certainty of approval. Concerns have grown about potential production halts. The Ministry of Commerce in Beijing has repeatedly said it has approved applications for companies in the EU and intends to speed up the process. — dpa
Miami Herald
15 hours ago
- Business
- Miami Herald
China Issues Update After Trump Reveals Trade Deal
China confirmed that it had agreed with the U.S. to approve the accelerated export of rare earths after President Donald Trump said he had made a trade deal with Beijing. The agreement relates to the earlier tariff-slashing U.S.-China trade talks in Geneva, which stalled over American concerns that Beijing was dragging its feet on exporting rare earths vital to manufacturing. They held further talks in London after a call between Trump and Chinese President Xi Jinping to break the deadlock, and the two sides kept talking until the news that a deal had finally been cemented. A spokesperson for the Chinese Ministry of Commerce said on Friday, June 27, that leaders of the two countries had now approved the details of the agreement. They said the U.S. will also lift some of its restrictions. China hopes the two countries will continue to move toward each other, the spokesperson said. Trump, talking about negotiating trade deals during his reciprocal tariffs pause on Thursday, said we "just signed with China yesterday". "In the China deal, we're starting to open up China," Trump said. This is a breaking news story. Updates to follow. Related Articles China Sends Stark Warning to US AllyChinese Satellite Image Shows Destruction of Iran Drone FactoryChina to Hegseth: US on Path to 'Fire and Suffering'Key US Ally Quietly Prepares for China's Pacific War With America 2025 NEWSWEEK DIGITAL LLC.
Ya Libnan
19 hours ago
- Business
- Ya Libnan
China confirms details of U.S. trade deal
HIGHLIGHTS The U.S. and China have confirmed details of a trade framework that seeks to allow rare earth exports and easing of tech restrictions, according to a statement released by China's Ministry of Commerce Friday afternoon. China will review and approve export applications for items subject to export control rules, while the U.S. will cancel a range of existing restrictive measures imposed against Beijing, a spokesperson for the ministry said in the statement, without elaborating. The statement comes after U.S. President Donald Trump said Thursday at an event in the White House that 'we just signed with China yesterday.' A White House official later clarified that the administration and China had agreed to 'an additional understanding of a framework to implement the Geneva agreement.' Earlier this month, trade negotiation teams from both sides, led by U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, reached an agreement on implementing the Geneva consensus after two days of high-level talks in London. The London agreement has stabilized what had become a fraught relationship, with both sides accusing each other of violating the Geneva trade agreement. Alfredo Montufar-Helu, senior advisor for the China Center at think tank The Conference Board, said that while the development is encouraging, 'it's important to temper expectations.' He added that there was a lack of clarity on which rare earth export curbs will be relaxed, barring magnets. Montufar-Helu said that rare earths were vital for national security on both sides, thus trade in these goods will likely remain constrained. Following the initial trade meeting in Geneva, Switzerland in mid-May, Washington and Beijing had struck a preliminary agreement to suspend a majority of tariffs on each other's goods for 90 days and to roll back certain restraints. The Geneva deal later faltered over China's slow-walking on relaxing curbs on rare earths exports and the U.S. tightening restrictions on tech and Chinese student visas. (CNBC)
Newsweek
a day ago
- Business
- Newsweek
China Issues Update After Trump Reveals Trade Deal
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. China confirmed that it had agreed with the U.S. to approve the accelerated export of rare earths after President Donald Trump said he had made a trade deal with Beijing. The agreement relates to the earlier U.S.-China trade talks in Geneva. A spokesperson for the Chinese Ministry of Commerce said on Friday, June 27, that leaders of the two countries had now approved the details of the agreement. They said the U.S. will also lift some of its restrictions. China hopes the two countries will continue to move toward each other, the spokesperson said. This is a breaking news story. Updates to follow.
Mint
2 days ago
- Business
- Mint
China is still choking exports of rare earths despite pact with US
Two weeks after China promised the U.S. it would ease the exports of rare-earth magnets, Chinese authorities are dragging out approval of Western companies' requests for the critical components, a situation that could reignite trade tensions between Washington and Beijing. Western companies say they are receiving barely enough magnets for their factories and have little visibility of future supplies. Firms are waiting weeks as Chinese authorities scrutinize their applications—only to be rejected in some cases. And applications for raw rare earths, which are used to make magnets, are rarely granted. As a result, Western companies are concerned that the shortages could soon affect manufacturing. Companies are so desperate for magnets that they are opting for expensive airfreight whenever licenses are granted to prevent costly production shutdowns. Some manufacturers are experimenting with workarounds that would allow them to make their products without the most powerful magnets. 'It's hand to mouth—the normal supply-chain scrambling that you have to do," said Lisa Drake, a vice president overseeing Ford's industrial planning for batteries and electric vehicles, earlier this week. Although she said the situation had improved, the scarcity of the rare-earth magnets is forcing Ford to 'move things around" to avoid factory shutdowns, she said. Manufacturers have taken the continuing challenges as a sign that new Chinese rare-earth export restrictions, introduced in April after President Trump raised tariffs on China, are here to stay—contrary to White House assertions that the flow of the critical components would return to normal. 'Yes, the export restrictions have been paused on paper. However, ground reality is completely different," said Neha Mukherjee, a rare-earths analyst at Benchmark Mineral Intelligence. The licensing process is plagued by 'bureaucratic drag." China's Ministry of Commerce said Thursday that it has been accelerating the review of rare-earth export license applications and has approved 'a certain number." The supply of rare minerals such as gadolinium is tightly controlled by China. The restrictions illustrate the power Beijing holds through its formidable supply chains and how it can use them to inflict pain on Western businesses and exact concessions from the U.S. China makes 90% of the world's most powerful rare-earth magnets, a key component in everything from cars to jet fighters. In April, after Trump heaped stiff tariffs on Chinese products, Beijing established an export-control system for rare earths. While it said the license system was set up to regulate the export of materials for military use, the regime has in effect allowed China to clamp down on rare-earths supplies as it wishes. After April, the supply of magnets to Western businesses slowed to a trickle, causing shock waves for global car, defense and electronics makers. Exports of rare-earth magnets to the U.S. declined 93% in May from a year earlier. Ford stopped production of its Explorer SUV at its Chicago plant for a week in May. The U.S. accused China of slow-walking the approval of export licenses, which China denied. The shortage drove both sides back to the bargaining table earlier this month, where China agreed to free up the flow of rare earths in exchange for the U.S. easing its own restrictions on certain U.S. exports to China. Following the deal, Trump wrote that 'full magnets, and any necessary rare earths, will be supplied up front by China." However, China put only a six-month limit on any new licenses, The Wall Street Journal has reported. Now, in the applications for export licenses, Chinese authorities are asking Western companies for sensitive details such as contact information of those buying their magnets and even designs of how their magnets are integrated into components like motors. Chinese authorities justify the scrutiny as necessary to ensure the magnets aren't used for military purposes, say companies involved in the magnet trade. The U.S. has accused China of slow-walking the approval of export licenses, which China has denied. When companies skip certain questions on their magnet applications to avoid disclosing sensitive intellectual property or details of commercial arrangements, their applications languish or are denied. In some cases, the applicants have then been told to start over and include all of the required information in a new application, which takes 45 days to process, according to companies involved in rare-earth imports. 'The control is real," said a representative of one such company. 'There are thousands of applications the [Chinese authorities have] received." Earlier this month, Germany's main industry association called on the country's new government to push China to ease the approval process. 'German industry needs to be able to plan in the near term. Licensing procedures must not be used as a means of exerting political pressure," it said. Beijing also appears to be trying to prevent stockpiling by Western businesses. One Chinese magnet maker has warned clients seeking to import more magnets than usual that they may have to explain to government officials the 'business drivers" behind such large orders, according to an advisory note the magnet maker shared with clients. Fearful of shortages, many Western businesses are complying with the information requests—but are still facing long delays. The success of their application also depends on their supplier. Big state-connected magnet companies are getting export licenses faster than smaller private ones, according to many in the industry. 'The export policy for magnet[s] is still very strict," said a representative for one Chinese magnet maker. Now, some Western businesses say they are resigned to the fact that the restrictions may remain in place indefinitely. Some private Chinese magnet makers, who are under significant financial pressure due to the export controls, are working with clients to find workarounds. For instance, some are encouraging foreign clients to buy less-powerful magnets that don't include any controlled rare earths. Some Chinese companies are also working to develop stronger magnets that don't rely on restricted materials such as dysprosium and terbium. But swapping out the most powerful and heat-resistant magnets is often impossible for the auto and electronics industries, which rely on magnets to efficiently power motors. Olive Lien, an expert in semiconductor-cooling technology based in Taiwan, said many companies in recent months have been struggling to acquire rare-earth magnets needed for some high-end fan motors used in products such as AI servers and other high-performance computing systems. Many companies have been forced to redesign their products, such as by switching to cheaper and more readily available ferrite magnets, which are less powerful. One U.S. magnet importer said that while two licensing applications he was involved with were recently approved, others are dragging. 'The system is slow and burdensome," he said. 'Very detailed and confusing for the applicants." When automobile-parts companies do get their licenses approved, they are paying extra to rush the magnets to factories by air, costs which are often ultimately borne by the carmakers. 'These are the things you don't hear about, how much money it is taking to keep these factories running, you know, limping along," the magnet importer said. Write to Jon Emont at
