US and China Agree to One-Year Pause on Punitive Tariffs

In a recent development in US-China relations, President Donald Trump and Chinese leader Xi Jinping have agreed to a one-year pause on the punitive tariffs imposed during the ongoing trade war. The agreement was made during their meeting in Busan, South Korea, where they discussed key issues, including China’s significant control over rare earth metals and the export restrictions affecting NVIDIA’s AI chips.

Trump has previously threatened to implement new tariffs up to 100% on Chinese imports in response to China’s tightening grip on rare earth elements, which are crucial for manufacturing many technologies, including smartphones and military equipment. As part of this temporary agreement, China has reportedly committed to pausing any new restrictions for a year in exchange for Trump’s decision to reduce existing tariffs on Chinese goods by 10%.

Additionally, discussions included semiconductors, with Trump noting he has not ruled out allowing NVIDIA to sell AI chips to China. After an initial ban earlier this year, NVIDIA was permitted to sell its H20 chips in China in July, despite subsequent reports of Beijing instructing its tech firms to hold off on purchases until a national security review was conducted.

Despite these discussions, no updates were provided regarding NVIDIA’s advanced Blackwell chips, currently in development, nor regarding the future of TikTok in the US. The last reported status indicated that the Trump administration was close to an agreement for US majority ownership of TikTok, but no final arrangements have been made yet.

Stay tuned for further updates on these critical negotiations and their impact on the tech industry and global trade relations.