Trump Extends China Tariff Suspension Amid Trade Talks
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A last-minute extension of suspended tariffs on Chinese goods signals continued, albeit cautious, engagement between Washington and Beijing. On November 11th, US President Donald Trump signed an executive order extending a 90-day suspension of certain tariff measures imposed on China, averting a significant escalation in trade tensions.
Avoiding a Tariff Surge
The deadline for the suspension was rapidly approaching, set to expire at 12:01 AM Eastern Time on November 12th (1:01 PM Japan time on November 13th). Had the measure not been extended, the US would have increased tariffs on Chinese products to 145%, while China would have retaliated with a 125% tariff on US goods. The extension maintains a more moderate tariff rate of 30% on Chinese imports, encompassing a 10% base rate and an additional 20% linked to fentanyl-related products.
The US Treasury Department and the US Trade Representative (USTR) offered no official comment regarding the extension.
A Positive Signal for Future Negotiations
Experts view the move as a positive development, suggesting both sides are actively seeking a path toward a broader agreement. “It’s positive news,” stated a former USTR official. “Both sides are trying to see if they can reach some kind of agreement that will serve as the foundation for this fall’s summit.”
According to a senior official with experience in the first Trump administration, the extension likely came after China made additional concessions. This suggests a continued pattern of negotiation and leverage employed by the US administration.
Soybean Purchases and Semiconductor Restrictions
President Trump previously highlighted increased Chinese purchases of US soybeans, stating on November 10th that China’s purchases were four times higher than previously. He indicated a desire to further expand these purchases, though he did not reiterate this request on November 11th.
Simultaneously, US officials announced on November 10th that leading semiconductor companies, NVIDIA and Advanced Micro Devices (AMD), have agreed to pay the US government 15% of their sales revenue from advanced semiconductors sold to China for use in artificial intelligence (AI) applications.
This multifaceted approach – tariff adjustments, agricultural trade, and technology restrictions – underscores the complex dynamics at play in the US-China trade relationship. The extension of the tariff suspension provides a window for continued dialogue, but the underlying tensions and strategic competition remain significant.
