US and China meet for trade talks in London

 US and China trade talks:

  Who’s Meeting & Why It Matters

• US Delegation:

  • Treasury Secretary Scott Bessent

  • Commerce Secretary Howard Lutnick

  • Trade Representative Jamieson Greer

• Chinese Delegation:

  • Vice Premier He Lifeng

    These meetings resumed the China–US economic and trade consultation mechanism,
launched after the 90‑day truce struck in Geneva on May 12, 2025, aimed at de-escalating tariffs
and trade tensions .

   Core Topics on the Table

1. Rare Earths & Critical Minerals

   • The US is pressing Beijing to resume large-scale exports of rare-earth minerals and magnets—critical components in high-tech industries

   • In return, the US may ease export controls on semiconductors and certain tech goods .

   • China has already approved licenses for supplying rare-earths to US automakers—seen as a goodwill gesture.

2. Export Controls & Tech Regulations

   • The US is targeting advanced semiconductor and AI export limits, especially those that could boost China’s military capabilities.

   • China demands broader access to US technologies and better treatment of its students and researchers abroad.

3. Tariffs, Trade Flows & Market Impact

   • Chinese exports to the US dropped ~35% YoY in May—the steepest fall since Feb 2020

   • After the Geneva freeze, global markets showed cautious optimism; some tariffs were lifted and sentiment improved.

4. Wider Geopolitical Factors

   • Talks overlap tensions over Taiwan, student visa revocations, and fentanyl trafficking.

   • Though focused on trade, broader geopolitical issues remain unresolved.

Sequence of Events

• May 12: Geneva agreement launches 90‑day suspension of tariffs.

• June 5: Trump and Xi hold a phone call reportedly ending positively, leading to a commitment to London talks

• June 9: Delegations begin negotiations at Lancaster House (London)—expected to continue into Tuesday.

   Outlook & Analysts’ Take

• Most experts believe London will yield incremental, short-term gains—like rare earths supplies and tech export concessions—but not sweeping structural reform

• A key objective is a “handshake agreement”, symbolizing mutual goodwill and signaling continuation of the Geneva truce

• Markets have responded positively: stock indices stabilized, bond yields softened, and optimism around easing trade friction boosted sentiment.

 
Bottom Line

• Goal: Build on the Geneva truce with tangible follow-ups

• Main Focuses: Rare earths export, semiconductor export controls

• Challenges: Broader issues (tech, visas, Taiwan) remain sensitive

• Likely Result: Modest agreements and renewed market calm, not major overhauls.