In a last-minute decision, U.S. President Donald Trump has signed an executive order extending a trade truce with China, delaying higher tariffs for another 90 days. The move, announced just hours before the existing agreement was set to expire on August 12, 2025, provides a temporary reprieve in the escalating trade tensions between the worldâs two largest economies, offering hope for a more stable global market.
A Fragile Pause in the Trade War
The extension, reported by The Wall Street Journal and CNBC, keeps U.S. tariffs on Chinese goods at 30% and Chinaâs retaliatory tariffs on U.S. products at 10%, avoiding a return to triple-digit rates that had threatened to disrupt global trade. The truce, initially brokered in May 2025 during high-level talks in Geneva, was a response to earlier tariff hikes that saw U.S. duties on Chinese imports soar to 145% and Chinese levies on U.S. goods reach 125%. This temporary de-escalation has been shaky, with disputes flaring during follow-up meetings in London and Stockholm, where U.S. officials accused China of breaching the agreement.
Trump, speaking to reporters on August 11, 2025, remained optimistic about the negotiations, stating, âWeâve been dealing very nicely with China. The relationship is very good with President Xi [Jinping] and myself.â He also highlighted the significant tariff revenue collected since his return to the presidency in January 2025, underscoring his administrationâs focus on addressing trade imbalances. Meanwhile, Chinaâs foreign ministry spokesman Lin Jian emphasized Beijingâs desire for âpositive outcomesâ based on âequality, respect, and mutual benefit,â signaling a willingness to continue dialogue.
Broader Trade Strategy and Global Impact
The extension reflects Trumpâs broader trade policy, which has seen a 10% âreciprocalâ tariff imposed on most U.S. trading partners, with higher rates for specific nations like the European Union (15%) and Syria (41%). Exclusions apply to sectors like steel, aluminum, pharmaceuticals, and semiconductors, as well as gold, following Trumpâs clarification on August 11 that gold imports would remain untouched. The U.S. has also targeted countries like Brazil over political issues and India over its Russian oil purchases, highlighting the geopolitical dimensions of Trumpâs tariff strategy.
For global audiences, this extension is a critical development. The U.S.-China trade war has ripple effects, influencing supply chains, consumer prices, and economic stability worldwide. The pause, set to expire in early November 2025, gives negotiators more time to address contentious issues, including Trumpâs push for China to âquadruple its soybean ordersâ to balance trade.
What Lies Ahead?
While the truce offers temporary relief, its fragility remains a concern. Past negotiations have been marred by accusations of non-compliance, and U.S. trade envoy Jamieson Greer noted that Trump retains the âfinal callâ on future extensions. With global markets closely watching, the coming months will test whether both sides can move beyond a shaky dĂ©tente toward a lasting resolution. For now, this extension keeps the door open for diplomacy, offering a glimmer of hope amid a turbulent trade landscape.
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