World trade: USA and China loosen trade restrictions after deal

According to both sides, China and the United States have agreed on the end of certain trade restrictions. As the Ministry of Commerce announced in Beijing, China will examine and approved applications for the export of “controlled goods”, which correspond to the provisions. In return, the United States would pick up a number of “restrictive measures” against China, it continued.

US President Donald Trump had previously mentioned an signed agreement with China – but left many questions open. “We only signed China yesterday,” said the Republican at an event in the White House. He did not explain what is specific. The sentence fell when Trump spoke about deals with other countries. He also put in the room that “maybe” could be a very large deal with India.

Rare earths against high-tech goods

US trade minister Howard Lutnick then confirmed in the interview of the financial news agency Bloomberg that the deal was signed with China. According to him, China will deliver rare earths and the United States will end its countermeasures for this.

The long -lasting trade conflict of the two largest economies USA and China keeps the global economy in suspense. In the meantime, Trump had increased punitive tariffs on imports from China to the USA in several steps to 145 percent. Beijing, in turn, had reacted with counter -tariffs of 125 percent and export controls for industrially important rare earths and magnets made from them – China basically adheres to a monopoly.

Open questions in the customs dispute

At the climax of the customs dispute, delegates of both sides in Geneva in Switzerland agreed to significantly reduce and continue to negotiate the tariffs for 90 days in Geneva in May. So far, however, it is unclear how it could continue after the deadline in August. The United States subsequently imposed further restrictions on the export of important technology such as software for computer chips and components for aviation, in which China is still dependent on foreign manufacturers.

At another meeting of both sides in London in early June, the focus was on trade restrictions. US representatives finally agreed on a reduction with the Chinese, although no details became known for a long time. Observers evaluated the result as a return to the status of the negotiations after the meeting in Geneva. After the Londoner, the presidents of both countries should still have the decisions.

Important role less frequently

Due to China’s export restrictions on rare earths, industry was recently under significant pressure outside of the People’s Republic. Beijing’s measures concerned all countries, not just the USA. In Germany, too, companies in the automotive industry or in mechanical engineering also take care of the supplies of the important metals, which are installed for sensors or in electric motors, for example.

China justified the controls with the fact that I am about goods for civilian, but also military use in the raw materials. It was heard from companies that the Chinese Ministry of Commerce takes a long time to process the applications without certainty on approval. Worries about possible still stands in the productions spread. The Ministry of Commerce repeatedly emphasized that it had already approved applications for companies in the EU and wanted to accelerate the process.