US and China Forge Preliminary Trade Agreement Ahead of Key Summit

Mon Oct 27 2025 06:02:51 GMT+0200 (Eastern European Standard Time)

The United States and China have reached an essential framework for a trade deal, setting the stage for discussions between President Trump and President Xi Jinping this week.

The US Trade Secretary has announced that the US and China have successfully negotiated a framework for a potential trade deal. This agreement includes a resolution on TikTok's operations in the US and a deferment on China's restrictions on rare earth minerals. The leaders of both countries are expected to discuss this framework further during their upcoming meeting in South Korea, aiming to avert escalating trade tensions.

The US and China have agreed on the framework of a potential trade deal that will be discussed when their respective leaders meet later this week, the US trade secretary has said.

Scott Bessent told the BBC's US news partner CBS that this included a final deal on TikTok's US operations and a deferral on China's tightened rare earth minerals controls.

He also stated he did not anticipate the 100% tariff on Chinese goods threatened by President Trump coming into effect, while China is expected to resume significant soybean purchases from the US.

Both nations are keen to avoid further escalation in a trade war between the world's two largest economies.

Trump and Xi Jinping are scheduled to hold talks on Thursday in South Korea. Bessent engaged with senior Chinese trade officials on the sidelines of the Association of Southeast Asian Nations (Asean) summit in Malaysia, where they reported constructive discussions.

Bessent noted that the countries had reached a substantial framework for the two leaders, asserting, The tariffs will be averted. Since his re-election, Trump has imposed and threatened significant tariffs on imports from overseas, particularly targeting China to enhance US manufacturing and job growth.

China retaliated with measures of its own, but both parties agreed to withhold implementing tariffs while pursuing negotiations for a trade deal.

Nevertheless, Trump has warned of new 100% tariffs on Chinese goods starting in November unless China rolls back its tightened restrictions on rare earth exports, which are crucial for electronics production.

China currently processes approximately 90% of the world's rare earths, making this an essential bargaining point. Bessent indicated that China will delay that for a year while they re-examine it.

Another topic of intense negotiation is soybeans, with China being the largest global buyer. The trade war previously prompted China to halt all purchases, adversely impacting US farmers. Bessent hinted the soybean boycott might soon be resolved, although he refrained from providing specific details.

I’m actually a soybean farmer, so I have felt this pain too... I believe when the announcement of the deal with China is made public that our soybean farmers will feel really good about what’s going on for this season and the coming seasons for several years, Bessent stated.

He also mentioned an agreement reached concerning TikTok's US operations, which Trump and Xi are expected to finalize during their meeting. National security concerns have led the US to push for the app's parent company, ByteDance, to divest its US operations.

TikTok had previously been instructed to sell its US operations or face a shutdown, but Trump has postponed the ban multiple times to enable further negotiations, extending the deadline once more to December.