What Trump and Xi Agreed on Tariffs, Export Controls, and Fentanyl

The White House on Saturday released details of the deal reached earlier this week between U.S. President Donald Trump and Chinese President Xi Jinping aimed at easing their countries’ trade war. The agreement includes cuts to U.S. tariffs, a freeze on Beijing’s new restrictions on rare earth minerals and magnets, and a resumption of Chinese purchases of U.S. soybeans.

The deal also averts Trump’s threat to impose 100% tariffs on all Chinese imports, extending a fragile truce between the world’s two largest economies for roughly another year. The agreement was reached on Thursday in Busan, South Korea.

Tariff Reductions on Fentanyl-Linked Goods

The U.S. will halve its 20% tariff on Chinese goods linked to the supply of fentanyl opioid precursor chemicals.

According to U.S. officials, the 10% reduction will lower the overall tariff rate on Chinese imports from 57% to about 47%. That total includes Trump-era duties of roughly 25% imposed during his first term, a reduced 10% “reciprocal” tariff added in April, and existing Most-Favored-Nation rates.

China Freezes Rare Earth Export Controls

China agreed to suspend for one year its new export controls on rare earth minerals and magnets, which are vital for cars, aircraft, and weapons — and have become a key point of leverage in its trade standoff with Washington.

Those controls would have required export licenses for products containing even small traces of certain elements, effectively targeting military-related end uses.

The White House said China will also issue general export licenses for rare earths, gallium, germanium, antimony, and graphite, benefiting U.S. end users and suppliers. The administration called the move equivalent to “rolling back the export restrictions imposed in October 2022 and April 2025.”

China also agreed to suspend all retaliatory tariffs it announced on March 4, which included duties on U.S. chicken, wheat, corn, cotton, sorghum, soybeans, pork, beef, seafood, fruits, vegetables, and dairy products.

Beijing further agreed to lift or suspend all non-tariff retaliatory measures imposed against the U.S. since March 4 — including the blacklisting of certain American firms on China’s “unreliable entities” list.

U.S. Pauses New Export Controls

The U.S. will suspend for one year the Commerce Department’s plan to expand its blacklist of companies barred from purchasing U.S. technology, including semiconductor manufacturing equipment.

The proposed expansion would have automatically added any firm more than 50% owned by an already listed company — a move that could have impacted thousands of Chinese firms.

China to Resume U.S. Soybean Purchases

China agreed to purchase at least 12 million metric tons of U.S. soybeans in the final two months of 2025 and no less than 25 million metric tons annually for the next three years.

Beijing will also restart purchases of U.S. sorghum and hardwood logs, the White House said.

China had largely halted U.S. soybean imports this fall, opting instead for supplies from Brazil and Argentina. The renewed purchases follow strong pressure from American farmers — a key Trump constituency — who had lobbied the administration to push for expanded trade.

Analysts noted the commitments merely return China’s soybean imports to pre-trade war levels. The U.S. exported about 27 million tons of soybeans to China in 2024. Beijing had made similar promises in the “Phase One” trade deal of 2020, though those targets were never met due to the COVID-19 pandemic.

The White House also said China will facilitate trade resumption from Nexperia’s China facilities, enabling the global production of essential legacy chips.

Beijing will extend its market-based tariff exclusion program for U.S. imports through December 31, 2026, and end antitrust, anti-monopoly, and anti-dumping investigations targeting U.S. semiconductor firms.

Port Fees and Maritime Trade

China agreed to remove measures imposed in response to Washington’s Section 301 investigation into Chinese dominance in global shipping, logistics, and shipbuilding — including lifting bans on specific shipping entities.

In turn, the Trump administration will suspend for one year its newly introduced port fees on Chinese-made, owned, and flagged vessels. The fees, implemented on October 14, aimed to boost U.S. shipbuilding but risked adding millions in costs per voyage and slowing cargo flows.

The White House said both sides will continue talks on maritime trade, with Washington also engaging South Korea and Japan on rebuilding U.S. commercial shipbuilding capacity.

Cooperation on Fentanyl Trafficking

The White House said China agreed to take “major steps” to curb the flow of fentanyl into the U.S., including halting shipments of certain precursor chemicals to North America and tightening export controls on others worldwide.

U.S. Treasury Secretary Scott Basent told Fox Business Network that joint working groups will soon identify “objective measures” to track progress in reducing fentanyl flows, which have caused thousands of overdose deaths annually in the U.S.

Trump administration officials have cautioned that tariffs on fentanyl-linked goods will remain until Beijing demonstrates concrete action, citing past unfulfilled promises of cooperation.