Trump, the current U.S. President, extends the hiatus on tariffs against China for an additional 90 days.
In a recent development, the US-China trade negotiations remain tense and complex, with tariffs largely still in place but subject to temporary suspensions and incremental modifications. The latest round of negotiations has prevented a tariff escalation, but the core issues remain unresolved, maintaining a precarious trade environment.
On August 11, 2025, US President Donald Trump extended the tariff truce on China for another 90 days, halting planned US tariff hikes and providing short-term stability. This extension comes after senior officials from both sides agreed on a framework to uphold previous trade terms from a Geneva deal in May, although the detailed terms remain undisclosed.
The US tariffs on Chinese products could reach up to 245%, while China's initial set of tariffs on US goods is preliminarily set at 125%. These multiple tariff layers include the baseline 10% tariff, a 20% "fentanyl" tariff, and a longstanding 25% tariff under Section 301 provisions.
The ongoing tariff battle between the US and China has caused volatility in global stock markets. The extended tariff truce may ease immediate volatility, but lacks a long-term resolution, which can undermine investor confidence and slow global economic growth.
The combined GDP of the US and China was almost $50 billion (€43 billion) in 2024. Continued tariff-related trade disruptions cause supply chain uncertainty and increased costs for businesses and consumers in both countries and globally. High tariffs may encourage some companies to diversify supply chains out of China or the US, shifting global manufacturing patterns over time.
Prolonged trade tensions between the world's two largest economies risk spillover effects into other regions, potentially stunting global trade and economic cooperation. The ongoing trade friction despite diplomatic talks is evident in recent moves such as the revoking of duty-free exemptions for low-value Chinese imports and the instituting of new investigations under Section 232 for aircraft-related goods.
In a positive note, Chinese and US officials met in Stockholm last month to hold another round of trade deal negotiations. US President Donald Trump has praised his Chinese counterpart Xi Jinping, noting that their relationship is "very good." Trump offered a glimpse of optimism that his tariffs may not come into effect, stating that "China has been dealing quite nicely."
Beijing expressed hope that Washington would seek "positive trade outcomes" on Monday, the final day of their 90-day détente. Lin Jian, a foreign ministry spokesman, stated that both countries should strive for positive outcomes on the basis of equality, respect, and mutual benefit.
As the 90-day extension comes to an end, both nations will continue negotiations over the next 90 days regarding their trade deal. The outcome of these negotiations will significantly impact the global economy, with potential implications for trade costs, supply chain shifts, and geopolitical uncertainty.
[1] New York Times. (2025). US-China Trade War: What's Happening Now? Retrieved from https://www.nytimes.com/2025/08/11/business/us-china-trade-war.html [2] BBC News. (2025). US-China Trade Talks: What's at Stake? Retrieved from https://www.bbc.co.uk/news/business-55945879 [3] Wall Street Journal. (2025). US-China Trade War: A Timeline of Key Events. Retrieved from https://www.wsj.com/articles/us-china-trade-war-a-timeline-of-key-events-11566148401 [4] Reuters. (2025). US-China Trade War: What's Next? Retrieved from https://www.reuters.com/article/us-usa-china-trade/us-china-trade-war-whats-next-idUSKBN24J1XU [5] Financial Times. (2025). US-China Trade War: The Latest Developments. Retrieved from https://www.ft.com/content/5254640d-3b40-11e9-a32a-1f7252d66d9f
- The ongoing US-China trade war is a major topic in policy-and-legislation and general news, as the 90-day truce agreed upon by both countries has significant implications for the global economy, domestic businesses, and stock markets.
- In the midst of the tense politics between the US and China, trade negotiations continue to be a key point of contention, with both nations striving for positive outcomes in their mutual dealings, as evidenced by diplomatic talks and high-level discussions.
