China on Monday effectively extended its trade truce with the US by two months, after announcing it would continue to suspend certain trade measures. The trade truce was due to expire on Tuesday, with Chinese President Xi Jinping and US President Donald Trump expected to meet, for the third time so far this year, at the Asia-Pacific Economic Cooperation (APEC) leaders' summit in China next week.
After September's Washington summit between Trump and Xi, both sides proposed a $60-billion package of reciprocal tariff cuts, including roughly $17 billion worth of US farm goods that China imported in 2024, though the plan has yet to be finalised. US Treasury Secretary Scott Bessent in September said the two-month extension would give the two sides "more time to see what we can do on the economic front".
A 24 per cent additional tariff on US imports will remain suspended for two months from 1:01pm (0501 GMT) on Tuesday, but a tariff of 10 per cent will remain. China's state council, or cabinet, said China will extend export-control waivers for certain critical minerals and related technologies until January 10, 2027, the commerce ministry said.
Measures affecting 11 US firms on China's unreliable entities list and 16 on its export control list will remain suspended through to January 10, 2027, the commerce ministry said. The suspension of special port fees on US-linked vessels will be extended until January 10, 2027, China's transport ministry said.
A probe into shipping and shipbuilding supply chain security will remain suspended, the transport ministry said. The Chinese commerce ministry further said it would also extend the suspension of sanctions on five US-linked units of Hanwha Ocean by two months.
China is extending the tariff suspensions to implement the "outcomes and consensus reached at the Washington meeting between the heads of state of China and the United States," the state council's tariffs commission said. China has "noted that the US side has repeatedly stated that it intends to use Section 301 tariffs to replace the tariffs imposed under the International Emergency Economic Powers Act (IEEPA) that have been held invalid by judicial rulings," it said.
China will "closely follow subsequent measures taken by the US side and will, as appropriate, adjust relevant tariff countermeasures in light of developments," it added. The extension is seen as a strategic move to stabilize global markets ahead of the upcoming APEC summit.
Analysts suggest that while the immediate threat of escalating trade barriers has been mitigated, the long-term resolution of the dispute remains contingent on the upcoming high-level diplomatic discussions. Both nations are under pressure to resolve supply chain bottlenecks that have hampered industrial output throughout the year.
The inclusion of critical minerals in the waiver extension highlights the importance of these materials to the global technology sector. As the deadline for the next phase of negotiations approaches, both Washington and Beijing are expected to maintain a cautious stance, balancing domestic economic interests with the necessity of international trade cooperation.