BUSINESS – After two days of intensive negotiations in Geneva, the United States and China have reached a significant agreement to reduce import tariffs, aiming to ease ongoing trade tensions. As reported by Kompas.com, both nations have consented to lower their respective tariffs to a baseline of 10%, effective for a 90-day period starting May 14, 2025. This temporary measure is intended to provide relief to businesses and consumers affected by the prolonged trade dispute.
Prior to this accord, the U.S. had imposed tariffs as high as 145% on Chinese goods, while China had retaliated with tariffs up to 125% on American products. The new agreement reduces U.S. tariffs to 30%, comprising a 10% baseline levy and an additional 20% specifically targeting concerns related to fentanyl imports. China, in turn, has lowered its tariffs on U.S. goods to 10% and agreed to suspend certain non-tariff countermeasures implemented since April 2025.
This development has been met with cautious optimism. Chinese exporters, particularly those in manufacturing hubs like Yiwu and Dongguan, are exploring strategies such as establishing U.S.-based warehouses or relocating production to other countries to mitigate potential future disruptions. Analysts suggest that exporters may use this 90-day window to expedite shipments before any new restrictions are imposed.
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While the agreement marks a de-escalation in the trade war, uncertainties remain. Chinese officials have expressed skepticism about the durability of the truce, citing concerns over potential policy reversals. Public sentiment in China is mixed, with some viewing the agreement as a positive step, while others remain wary of U.S. intentions.
In the United States, the agreement has been interpreted by some as a strategic retreat from previously aggressive trade policies. President Trump described the deal as a “total reset,” though critics argue that it reflects a concession to mounting domestic and international pressures.
Economists and market analysts have offered varied perspectives on the agreement’s impact. Some believe it could boost consumer and investor confidence, while others caution that the temporary nature of the deal may not provide long-term stability. The consensus is that while the agreement mitigates immediate risks, long-term uncertainties persist.
As the 90-day period unfolds, both nations are expected to continue negotiations to address underlying trade issues. The outcome of these discussions will be critical in determining whether a more permanent resolution can be achieved.
