US and China Agree to Slash Tariffs for 90 Days Amid Efforts to De-escalate Trade Tensions

In a significant move to cool escalating trade tensions, the United States and China have agreed to suspend a large portion of their tariffs for a 90-day period, giving both economic powerhouses a chance to resolve ongoing disputes. The joint announcement was made on May 12, following high-level discussions in Geneva.

Starting May 14, the United States will reduce its combined 145% tariffs on Chinese imports to 30%, including those related to fentanyl-linked products. In return, China will lower its 125% duties on American exports to 10%, according to a joint statement and briefings from government officials.

A Pause in the Tariff War

The agreement marks a temporary 90-day pause on further trade measures between the world’s two largest economies. US Treasury Secretary Scott Bessent, who led the US delegation, said the deal involved a 115 percentage point cut in reciprocal tariffs.

“Both countries represented their national interest very well,” Bessent told reporters. “We both have an interest in balanced trade, and the US will continue moving in that direction.”

He also noted that the two sides had a robust and productive exchange on combating fentanyl-related issues and emphasized that neither side wants to decouple.

China Hails Progress

China’s Ministry of Commerce described the outcome as “substantial progress,” stating the move is in the interest of the two countries and the common interest of the world.

Beijing expressed hope that Washington would continue to work with China to correct the wrong practice of unilateral tariff rises.

Mechanism for Ongoing Dialogue

As part of the deal, both nations will establish a permanent dialogue mechanism to oversee trade and economic discussions. China will be represented by Vice-Premier He Lifeng, while the US delegation will include Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. These meetings may take place in China, the US, or a neutral third country.

Background: Tariff Escalation and Retaliation

Earlier this year, US President Donald Trump imposed steep new tariffs on a wide range of Chinese imports, bringing cumulative US tariffs on some items up to 245%. In retaliation, China introduced its own set of tariffs, reaching 125% on US goods.

The May 12 agreement comes amid increasing concerns from global markets about the ripple effects of prolonged trade hostilities between the two superpowers.