The United States and China reached an agreement on Monday 12 May to significantly reduce most of their reciprocal import tariffs over a 90-day period. The decision marks an important step towards de-escalating tensions between the world's two largest economies. CNBC reports.
During bilateral talks in Geneva, Switzerland, the two countries agreed to reduce so-called "reciprocal" tariffs from 125% to 10%. The exception to the reduction is the US duty of 20% on Chinese products related to fentanyl, leaving the total of US tariffs on Chinese goods at 30% for now.
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According to US Treasury Secretary Scott Bessent, the negotiations were constructive. 'We had very productive talks, thanks in part to the calming environment of Lake Geneva,' Bessent said at a press conference. 'With this agreement, both countries are reducing their tariffs by 115 percentage points and we are creating space for further dialogue.'
Both China and the United States stressed that talks on trade and economic cooperation will continue. The temporary reduction in tariffs is seen as an impetus to further normalise the trade relationship, after years of escalating tensions and mutual sanctions.
Source: CNBC