United States President Donald Trump signed an executive order on August 11, 2025, extending the deadline on tariff increases for Chinese goods by another 90 days, thereby averting a sharp escalation in trade tensions between the world’s two largest economies just hours before the previous truce was set to expire in Beijing.
This move follows months of fraught negotiations, steep tariff hikes, and ongoing uncertainty across global markets.
The latest extension comes after both nations agreed in May 2025 to temporarily lower punitive tariffs—the US reduced tariffs on Chinese imports from a peak of 145% to 30%, while China cut its tariffs on American goods from 125% to 10%— during a diplomatic meeting in Geneva, Switzerland.
This was designed to provide breathing room for further negotiations, following earlier episodes where tit-for-tat tariff increases had threatened severe disruptions to global supply chains, affected commodity flows, and contributed to inflationary pressures.
Negotiations between the US and China remain active and unresolved. The current truce is intended to allow officials on both sides more time to address deeper concerns. In the past month, economic policy teams convened in London and Stockholm as lingering disagreements surfaced—US negotiators accused their Chinese counterparts of violating the Geneva pact, and debates over technology exports, rare earth materials, and agricultural purchases continued.
Trump, when asked about the deadline, was notably non-committal, remarking, “We’ll see what happens. They’ve been dealing quite nicely. The relationship is very good with China’s President Xi Jinping and myself.” Chinese Foreign Ministry spokesman Lin Jian welcomed the extension and expressed hope Washington would pursue “positive outcomes on the basis of equality, respect and mutual benefit.”
Had the deadline lapsed without an extension, tariffs would have reverted to the earlier prohibitive levels—145% on Chinese imports to the US, and 125% by China on US goods—likely provoking another round of retaliation and inflicting further hardship on manufacturers and consumers alike.
The tariff battle, launched by Trump’s administration in response to what it regarded as unfair trade practices and persistent trade deficits, has already led to measurable economic pain: American businesses have absorbed much of the higher costs, while US consumers feel the impact in rising prices for everyday goods.
The extension provides temporary stability, but leaves the long-term dispute unresolved. The deadline for new negotiations is now set for November 10, 2025.
Trade officials and industry leaders have welcomed the delay as a necessary pause while both governments seek a deal that could address fundamental disputes ranging from intellectual property and industrial policy to technology and agricultural trade.
In addition, the truce has allowed some flexibility in technology and material flows—a recent decision permitted US companies Nvidia and AMD to resume semiconductor sales to China, while China eased restrictions on the export of rare earth metals.
Nonetheless, broader tariffs and regulatory pressures remain in place, and the diplomatic mood is optimistic but cautious. Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer both indicated that Trump retains the “final call” on any future extension, emphasising the strategic and political dimensions underlying the negotiations.
The tariff deadline extension signals a fragile pause in the ongoing US-China trade war, ensures continued negotiation rather than escalation, and underscores the high stakes for global economic stability.
The ultimate resolution will depend on the ability of both sides to reach substantive agreement on major trade and technology issues before the new November deadline.
Based On ANI Report
