US and Chinese trade negotiators said that they had agreed to a framework of a deal on tariffs and other issues before an expected meeting of the countries’ top leaders this week.
“We are moving forward to the final details of the type of agreement that the leaders can review and decide if they want to conclude together,” Jamieson Greer, the United States’ trade representative, said to reporters in Kuala Lumpur, Malaysia’s capital.
He said the two sides had also discussed another extension in a series of truces on tariffs they have engaged in this year.
China’s top trade negotiator, Li Chenggang, described the talks between the United States and China as “candid and in-depth discussions” on the trade deal, adding that the two sides had reached a “preliminary consensus.”
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The negotiators were in Kuala Lumpur for a meeting of the Association of Southeast Asian Nations, where US president Donald Trump began a nearly weeklong trip to Asia. He is expected to meet on Thursday with Xi Jinping, China’s president, at a separate economic meeting in South Korea.
The variety of issues discussed in Kuala Lumpur included bilateral trade, export controls, reciprocal tariff extensions, fentanyl-related tariffs and co-operation on combating fentanyl trafficking, according to the Chinese side.
Mr Greer said the negotiations had included rare earth metals, which are mostly produced in China and which are now subject to stringent export controls imposed this year by Beijing. “We talked about extending the truce, we talked about rare earths, of course, we talked about all kinds of topics,” he said.
Treasury secretary Scott Bessent said on NBC’s Meet the Press that the United States and China had reached a “very substantial framework”. He said that he expected China would offer “some kind of deferral” on its rare earth export controls, and added that the framework also included benefits for US farmers. China has stopped buying soybeans from the United States this autumn.
The discussions also included steep port fees that the US recently imposed on ships that were built in China or are owned by Chinese companies. China has retaliated by putting tariffs on American-built ships – few are left on international routes – and on ships partly or entirely owned by American companies or investors.
[ Trump administration set to impose steep fees on Chinese ships docked in US portsOpens in new window ]
Both sides were careful to suggest that they did not have a final deal.
“China and the United States constructively explored a plan for appropriately dealing with some of the concerns of both sides,” Mr Li said. He added, “The next step is for each side to fulfil their respective domestic approval procedures.”
Mr Li’s reference to “internal approval procedures” used a Chinese term that could be construed as signalling that administrative steps may be planned. China’s ministry of commerce issued extensive export regulations on October 9th that immediately halted any further transfer out of China of the technology needed to process rare earth metals.
Rare earth metals are essential to a wide range of advanced manufacturing, including the production of cars, semiconductors, drones, factory robots and offshore wind turbines, as well as missiles, fighter jets, tanks and other military equipment.
China produces 90 per cent of the world’s refined rare earths and rare earth magnets, and up to 100 per cent of some kinds of rare earths that are particularly needed for the most cutting-edge technologies and military applications.
China’s ministry of commerce has severely restricted exports of rare earths and rare earth magnets to countries all over the world since April 4th. It ordered further export controls on October 9th that are scheduled to take effect on November 8th and December 1st.
[ China clamps down on rare earth exportsOpens in new window ]
Those rules would limit any shipments across any country’s borders of products containing Chinese rare earth magnets. The rules would also limit exports of equipment to make electric car batteries, another sector in which China is trying to preserve its global technological leadership.
The new regulations would also limit exports of equipment, such as diamond saws, that are needed in the manufacturing of semiconductors and solar panels. Trump has threatened to impose 100 per cent tariffs on goods from China if Beijing goes ahead with the export controls.
Mr Bessent echoed Mr Greer and Mr Li in cautiously portraying progress achieved in the Kuala Lumpur talks. “We have a very successful framework for the leaders to discuss,” he told reporters after the negotiations on Sunday.
This article originally appeared in The New York Times.
