After one year, is the trade war between the USA and China calming down?

Context: This news article discusses the recent developments between China and the United States regarding trade negotiations and tariff reductions.

Fact Check: The content is accurate and does not contain any false information.

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Contributors: Una Hajdari with AFP

Published on: 20/05/2026 – 13:24 UTC+2

Summary:
Beijing is going to work with Washington to reduce customs duties on tens of billions of dollars worth of goods, the Ministry of Commerce announced on Wednesday, a few days after President Donald Trump’s visit to China.

Throughout most of 2025, the world’s two largest economies were embroiled in an escalating trade war until a one-year truce was reached between Donald Trump and Chinese President Xi Jinping during their meeting in South Korea in October.

At the end of their summit last week, a trade council was established under which “the two sides have agreed in principle to engage in discussions on a framework agreement providing for reciprocal tariff reductions on products of equivalent value,” the ministry said in a statement.

The potential tariff reductions will cover goods worth at least $30 billion on each side, according to a statement published online and attributed to an anonymous Commerce Ministry official.

China hopes that the U.S. will “respect the commitment made” during the recent round of negotiations, calling for the extension of trade truce agreements reached last year.

“These potential tariff reductions are, however, not significant enough to cause markets to revise their GDP growth forecasts,” said Zhiwei Zhang of Pinpoint Asset Management.

“It is still a positive step in the right direction,” he added. “As long as the two countries engage in dialogue to stabilize their bilateral relations, it is good news for investors worldwide.”

The Commerce Ministry also announced that China would restore approvals for certain American beef exporters, which had expired last year at the height of tensions with Washington.

Confirming another outcome of the Xi-Trump summit, the ministry stated that China would purchase 200 aircraft from the American aerospace giant Boeing, without specifying the models.

For several months, American media outlets had been discussing the prospect of a major order from Beijing for 500 737 MAX narrow-body jets and around 100 787 Dreamliners and 777 wide-body planes.

Regarding the supply of rare earths, a strategic sector dominated by China and subjected to severe export restrictions last year, the statement remained vague on details.

“The two parties will work together to examine and address each other’s legitimate and legally grounded concerns,” the text specified.