China says US trade truce extension creates space to advance talks

BEIJING – China said on Sept 28 a two-month extension of a trade truce with the US will provide space for both sides to evaluate the implementation of their arrangement to resolve economic and trade issues while considering how to advance on those fronts.

In confirming the extension till Jan 10, China’s Commerce Ministry said the pause also provides a “relatively stable and predictable policy environment” for cooperation among companies and continued active discussions.

The extension was one of the key takeaways from the second summit between Chinese President Xi Jinping and his US counterpart Donald Trump, hosted in Washington last week.

Among the first steps under a trade council that both sides have agreed to form is a discussion on a reciprocal tariff cut on US$30 billion (S$38.4 billion) worth of products, aimed at maintaining stable bilateral economic and trade relations.

This will also create better conditions for the export of related Chinese products to the US, the ministry said in its statement.

The economic and trade teams from both sides will conduct regular dialogues focusing on potential investment opportunities and barriers, enhancing policy transparency and predictability, and responding to reasonable concerns from enterprises, it said.

A list released by the White House showed China is planning to trim tariffs on a variety of US agricultural products and other categories, including medical equipment, raw materials and food items.

Agriculture and coal

China’s proposed tariff cuts under the US$30 billion of goods are dominated by agriculture, including corn, wheat, dairy and meat, but not soya beans, according to the White House statement.

The choice of products looks designed to help China meet what the White House says is a US$17 billion commitment to buy agricultural goods. China has already resumed large-scale buying of US soya beans under a deal struck in 2025 to buy 25 million metric tonnes annually.

Both countries will also set up an agriculture working group under the trade council, which will hold its first meeting before end-2026 to discuss two-way market access and regulation for agricultural products, China’s Commerce Ministry said.

The presidential summit also yielded a coal trade agreement for China to import coal from the US in 2027 and 2028, the White House statement showed. The amount roughly equals 2% of China’s coal imports each year. Liquefied natural gas and oil are not on the list.

“Importing US coal is not only a beneficial supplement to China’s domestic coal market, but also brings stable economic income and employment to the US coal industry,” the Chinese ministry said.

AI, financial firms and direct flights

On artificial intelligence, both sides have agreed on a communication channel for incidents and will hold a follow-up dialogue by the end of November.

China will also examine and approve foreign financial services institutions, including those with US capital, to conduct business and open branches in China.

There will be continued communication on increasing flights between China and the US, the ministry statement said. REUTERS