China and U.S. Reach Tentative Agreement in Trade Negotiations as Tariff Deadline Approaches

On October 26, Chinese and American trade representatives wrapped up economic and trade discussions in Kuala Lumpur, reaching an initial agreement to carefully tackle major concerns such as tariffs, export restrictions, and fentanyl oversight, according to Chinese Vice Premier He Lifeng and chief negotiator

. These negotiations, which took place alongside the ASEAN summit, were intended to help steady bilateral ties amid an intensifying trade conflict driven by tariffs from the Trump administration and China’s limits on rare-earth exports, stated.

These talks followed several months of rising friction, including U.S. tariffs on Chinese imports climbing to 155% and China’s countermeasures restricting vital minerals, according to a

. Li Chenggang, who recently shifted from his World Trade Organization post to focus on direct talks, was quoted in a as saying both parties showed “mutual respect” during the meetings, even though the U.S. maintained a “firm” stance. He also mentioned that the results will undergo internal review before the anticipated Trump-Xi meeting, as reported by the .

These negotiations come as the 90-day pause on tariffs—agreed upon after a September 19 phone conversation between President Trump and President Xi Jinping—approaches its November 10 expiration,

. Experts caution that if the truce collapses, global markets could experience renewed instability, having already been shaken by previous tariff increases. Reports indicate that the U.S. Treasury and Commerce departments sought commitments from China to relax rare-earth export limits, while China pressed for lower tariffs and collaboration on fentanyl controls, according to .

Despite the ongoing tensions, American business executives remain guardedly hopeful about China’s 15th Five-Year Plan (2026–2030), which focuses on advanced development and modernizing industry, as highlighted in a

. Dan Shamdasani from Public Clothing Company commended China’s “exceptional infrastructure” for fast manufacturing, while Shant Mouradian of Box City pointed out the cost benefits of sourcing from China. Ferish Patel of Cooley LLP observed increasing prospects in technology and life sciences, describing China’s evolution from “Made in China” to “Innovated in China” as a strategic move, according to the Bastille Post.

The discussions also covered wider geopolitical concerns, such as U.S. restrictions on advanced chip exports and China’s controls on gallium and germanium, which are vital for American defense and technology industries. Analysts have raised concerns about the potential market effects of these policies. Li Chenggang emphasized that China’s export rules “do not ban exports” and that applications meeting the requirements are approved, as reported by the

. Meanwhile, U.S. Treasury Secretary Scott Bessent—who had previously criticized Li—has recently adopted a more conciliatory approach ahead of the Trump-Xi meeting, according to observers.

Experts warn that mutual trust is still fragile. Wang Wen of Renmin University pointed out that inconsistent U.S. policies—such as backtracking on earlier agreements—hinder progress, a point noted in China Daily’s coverage. Nevertheless, both countries seem intent on preventing a full-blown trade conflict, with Li stating that a stable economic partnership is beneficial “for both nations and the global community,” as reported by the Business Times.

The initial agreement now awaits approval within both governments. With Trump’s November 1 tariff deadline approaching, analysts predict continued volatility in commodity markets and supply chains. The results of the late October Trump-Xi summit and the U.S. reaction to China’s rare-earth policies will be crucial, according to China Daily.

At present, the Kuala Lumpur negotiations have provided a temporary pause, but significant obstacles remain on the path to a lasting solution.

---