China’s International Trade representative, Li Chenggang, announced this Sunday (26) that Beijing and Washington had reached a “preliminary agreement” after two days of talks in Kuala Lumpur, Malaysia.
According to state news agency Xinhua, Li said the talks were “constructive” and resulted in an initial understanding of the main economic concerns of both countries.
“The next step will be for each party to comply with their respective internal approval procedures,” said the Chinese vice minister of Commerce, highlighting that the US maintained a “firm” stance, while China “determinedly defended its interests”.
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Tariffs, fentanyl and exports
Although the terms of the understanding have not yet been detailed, Li reported that the talks included sensitive topics such as Chinese controls on rare earth exports, anti-drug cooperation around fentanyl and the possible extension of the reciprocal suspension of tariffs between the two powers.
According to the Chinese representative, measures related to port tariffs imposed by the US on Chinese ships and strategies to expand bilateral trade in technology, energy and industrial input sectors were also discussed.
Hours before the announcement, US Treasury Secretary Scott Bessent had stated that the delegations “established very solid foundations” for the meeting between Trump and Chinese President Xi Jinping, scheduled for October 30, in South Korea.
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Rare earths and new tariffs
The negotiations take place at a time of strong commercial tension. In mid-October, China increased restrictions on exports of rare earths, strategic minerals used in electric vehicles, semiconductors and military equipment, for which Beijing has around 90% of the global market.
In response, Trump threatened to raise tariffs on Chinese products to 100% from November 1, a move that could deepen the trade war between the world’s two largest economies.
The dialogue in Kuala Lumpur, therefore, is seen as a move to ease tensions before the meeting between the two leaders, which should define the direction of the bilateral relationship and international trade in the coming months.
