U.S. and China in a Trade Deal with Details to Follow

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Jun. 12, 2025
By: Chaney A. Finn

On June 11 President Trump announced the broad outlines of a tentative trade deal between the United States and China. It appears that the parties intend to use it as a framework for resolving the many trade issues between the countries.

The announcement follows recent negotiations conducted in London between high level government officials including Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, U.S. Trade Representative Jamieson Greer, and their Chinese counterparts Vice Commerce Minister Li Chenggang and Vice Premier He Lifeng.

Key Provisions of the Tentative Agreement:

• Rare Earth Exports: China agrees to resume shipments of rare earth minerals and magnets, essential for U.S. industries such as defense and electronics. However, these shipments are subject to a six-month license, introducing a temporary measure to maintain leverage.
• Tariffs: The U.S. agrees to impose a 55% tariff on Chinese imports, combining existing tariffs related to fentanyl and other concerns. China will apply a 10% tariff on U.S. goods, lower than previous levels.
• Student Visas: The U.S. will allow Chinese students to study at American universities, maintaining academic exchanges.

Many questions surround the 55% total tariff as it reportedly represents a 10% baseline reciprocal tariff, 20% IEEPA tariffs to address the fentanyl emergency, and 25% from pre-existing tariffs from President Trump’s first term. Without any details at this time, the total 55% tariff appears to follow the logic previously discussed where tariffs on exports to the U.S. are stacked, or comprised of several other tariff-imposing trade measures in which the merchandise may be within scope. However, it is unclear at this point how Section 301 (which may be the 25% pre-existing) and Section 232 tariffs will apply. We will provide updates with this as they become available.

As a recap for how we got here, the recent trade negotiations stem from President Trump’s April 2 announcement where the U.S. imposed a 10% baseline tariff and 34% China-specific tariff on exports to the U.S. followed by a brief series of tariff escalations to 125% before returning to 34% which were paused for 90 days during negotiations and finally settling on a mutual 10% tariff. (What a ride!)

Next steps require final approval from both President Trump and Xi before being enacted by the corresponding agencies. There is no timeline for approval but it is reasonable to expect it within the near future, absent some intervening event or change in the relationship.

Should you have any questions regarding tariffs, or have any other trade-related questions, do not hesitate to contact any?attorney?at Barnes Richardson and Colburn.