Trump and Xi Reach One-Year Trade Truce in South Korea

President Donald Trump and Chinese President Xi Jinping reached a one-year tactical trade truce during a summit at Gimhae Air Base in Busan, South Korea, on October 30, 2025. The agreement aims to de-escalate a severe trade war that had seen U.S. tariffs on Chinese imports reach 145% and Chinese levies hit 125%. Under the terms, the U.S. reduced its combined import tariff rate on Chinese goods from 57% to 47%, specifically halving fentanyl-related tariffs from 20% to 10% in exchange for Beijing's commitment to curb the export of precursor chemicals.

China agreed to resume large-scale purchases of U.S. agricultural products, committing to buy 12 million metric tons of soybeans by January 2026 and at least 25 million metric tons annually through 2028. Additionally, Beijing agreed to a one-year suspension of export controls on critical rare earth minerals and magnets, as well as a pause on reciprocal port fees for U.S.-linked vessels. In return, the U.S. suspended a rule expanding the blacklist of Chinese technology firms and paused Section 301 investigations into China's shipbuilding industry.

Despite the economic detente, geopolitical tensions remained high. Minutes before the summit, Trump announced the resumption of U.S. nuclear weapons testing to maintain parity with Russia and China. While the leaders agreed to coordinate on the conflict in Ukraine, they avoided discussing the status of Taiwan. Market reactions were mixed, with some analysts characterizing the deal as a temporary stopgap rather than a strategic resolution of structural rivalries over artificial intelligence and manufacturing dominance.