The United States and China, which agreed to refrain from escalating the trade war following last month's summit between U.S. President Donald Trump and Chinese President Xi Jinping, began implementing partial suspensions of reciprocal trade retaliation measures on the 10th.
Starting at 12:01 a.m. (Eastern time, 2:01 p.m. Korea time) that day, the United States reduced the so-called "fentanyl tariff" imposed this year on Chinese products from 20% to 10%. As a result, the Trump administration's average tariff rate on China will drop from 57% to 47%.
Since taking office, President Trump has imposed a 20% "fentanyl tariff" on Chinese imports, saying China was not cooperating in blocking the inflow of fentanyl, a type of synthetic drug, into the United States. However, after talks with Xi on the 30th of last month, China signaled its willingness to cooperate in blocking fentanyl precursor substances, and the related tariffs were set to be reduced to 10%.
China, for its part, from 1:01 p.m. that day (2:01 p.m. Korea time), halted measures that had imposed an additional 15% tariff on U.S. chicken, wheat, corn, and cotton, and 10% on sorghum, soybeans, pork, beef, seafood, and other items. These tariffs were in retaliation for the U.S. "fentanyl tariff."
In addition, the United States and China formally began, as of that day, a one-year extension of the "truce" in their back-and-forth over extra-high tariffs of more than 100% that they had imposed on each other in April.
Earlier, at talks in Geneva in May, the United States agreed to cancel 91% of the additional 125% tariffs imposed on Chinese goods and to defer 24% for 90 days. The two sides added another 90-day extension in August, and at last month's U.S.-China summit agreed to extend it for an additional year.
China also decided to extend by one year, starting that day, the deferral of the 24% additional tariff rate on the United States that had been on hold. It also deferred until Nov. 10 next year the export control measures on rare earths and other items that had been scheduled to take effect on the 8th. On the 9th, it decided to suspend until Nov. 27 next year controls on exports to the United States of gallium, germanium, antimony, and graphite, which are used in semiconductors, solar panels, lasers, batteries, and weapons.
It then resumed purchases of U.S. agricultural products such as soybeans and temporarily lifted the suspension on imports of U.S. logs that was released in March. Sanctions imposed on U.S. defense companies over arms sales to Taiwan will also not be enforced for the next year.