Trump and Xi Pause Tariffs but Block Blackwell Chip Sales

President Donald Trump and Chinese President Xi Jinping reached an agreement in Busan, South Korea, to pause punitive tariffs for one year. The deal reduces U.S. tariffs on Chinese goods from 57% to 47% and suspends U.S. port fees targeting China's maritime and shipbuilding industries. In exchange, China will suspend restrictions on U.S. rare-earth mineral imports.

Despite the trade concessions, the summit did not resolve restrictions on advanced semiconductors. Trump initially suggested he might discuss the sale of Nvidia's state-of-the-art Blackwell AI chips, which he called "super duper," causing Nvidia's market valuation to briefly hit $5 trillion. However, Trump later clarified that while general semiconductor access was discussed, the Blackwell lineup was not on the table. U.S. Trade Representative Jamieson Greer reinforced this position, describing the chips as "crown jewels."

Nvidia CEO Jensen Huang expressed uncertainty about the company's future in China, noting that business has dropped to "zero" as the Chinese government encourages domestic firms to use local alternatives like Huawei. While Trump characterized the U.S. role in these commercial dealings as an "arbitrator or the referee," he maintained that Nvidia and China must resolve the matter through direct discussion. Huang cautioned that isolating Chinese developers could hinder the U.S. AI race, though he praised Trump's efforts to bring semiconductor manufacturing back to the United States.