BUSAN, SOUTH KOREA – October 30, 2025 – US President Donald Trump announced a significant reduction in tariffs on Chinese goods following a high-stakes meeting with Chinese leader Xi Jinping in Busan, South Korea, today. The two leaders, meeting on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, held face-to-face talks for the first time since 2019, successfully reaching a “framework” agreement aimed at stabilizing volatile trade relations.
Key Outcomes and Trump’s Statement
Speaking to reporters aboard Air Force One after the 100-minute meeting, President Trump called the talks a “great success,” stating, “a lot of things we brought to finalisation.” The key outcomes announced by the President include:
- Tariff Reduction: The combined US tariff rate on imports of Chinese goods will be lowered from 57% to 47%. This reduction is seen as a major gesture to ease the months-long trade tensions that have rattled global markets.
- Fentanyl Cooperation: Trump announced a reduction in fentanyl-related tariffs on Chinese goods, from 20% to 10%, in exchange for a commitment from President Xi to “work hard to stop fentanyl shipments” and curb the flow of precursor chemicals into the US.
- Rare Earths Settled: The two leaders clinched a one-year deal on rare earth exports, with Trump stating, “All the rare earths has been settled,” and that there would be “no more roadblocks.” This addresses China’s recent move to impose export controls on the critical minerals.
- Soybean Purchases: China has reportedly agreed to immediately resume large-scale purchases of US soybeans.
- Future Talks: President Trump announced he would visit China in April for new talks, with President Xi expected to visit the US at a later date.
Leaders’ Opening Remarks
Before the closed-door discussions, both leaders struck a conciliatory tone.
- President Trump described President Xi as a “very tough negotiator” but predicted a “very successful meeting” and a “fantastic relationship for a long period of time.”
- President Xi Jinping, speaking through a translator, stressed a willingness to cooperate despite differences. He noted that it is “normal for the two leading economies of the world to have frictions now and then,” and that the two nations should strive to be “partners and friends.” He also noted that economic teams had reached a “basic consensus” ahead of the summit.
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Market and Geopolitical Reaction
The news of the agreements and tariff cuts immediately sparked a positive reaction in global markets, with stock indices climbing and the Chinese yuan strengthening against the dollar amid hopes of a trade truce.
However, analysts cautioned that the agreement appears to be a “short-term stabilisation dressed up as strategic progress,” as deeper strategic rivalries over technology, manufacturing dominance, and geopolitical issues like the war in Ukraine and the status of Taiwan remain. Trump confirmed that Taiwan was not discussed during the meeting.
President Xi is scheduled to remain in South Korea to attend the APEC summit, while President Trump has departed for Washington D.C.
Would you like a more in-depth look at the tariff cuts or the fentanyl and rare earths agreements?
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