Following the initial agreement in Geneva last month to ease bilateral retaliatory tariffs, the United States and China resumed talks in London last week regarding a longer-lasting trade deal. Speaking to reporters concerning the London negotiations last Wednesday, U.S. President Donald Trump expressed his satisfaction with the progress: “We made a great deal with China. We’re very happy with it,” adding that “We have everything we need, and we’re going to do very well with it. And hopefully they are too.”
The “done-deal” with China, as President Trump posted on Truth Social, indicates “full magnets, and any necessary rare earths, will be supplied, up front, by China,” with a total of 55% tariffs for the U.S. and 10% for China. A White House official said in a Reuters report that the 55% tariff is made up of three parts: a base 10% “reciprocal” tariff on nearly all U.S. trade partners, a 20% tariff on all Chinese imports tied to Trump’s claim that China, Mexico, and Canada are responsible for fentanyl trafficking into the U.S., and an existing 25% tariff on Chinese goods from Trump’s first term.
Still, the officials have not officially detailed the framework of trade controls that emerged, and the countering tariffs have only gone back to “Liberation Day” status. Citing the fluctuating and uncertain foreign policies, a Washington Post opinion piece has labeled Trump’s approaches with China “miscalculations.” Despite the publicity around the “done‑deal,” the London talks stopped short of addressing a critical topic: China’s grip on rare‑earth exports with military uses. According to Reuters, Beijing “has not committed to grant export clearance for some specialized rare‑earth magnets that U.S. military suppliers need for fighter jets and missile systems.” While China offered “expedited export approvals for civilian‑use rare earths” and a “green channel” for trusted U.S. firms with six‑month licenses, it continues to withhold samarium and other military‑grade magnets. According to sources cited by Reuters, the shift toward export-control leverage represents “a new twist” in the negotiations. Without Chinese commitment to military‑spec magnets, broader progress stalls. U.S. officials are reportedly inclined to extend current tariffs for 90 days past the Geneva deadline—a signal that a full, stable deal is unlikely before then.
Meanwhile, China’s domestic export authorities confirmed the issuance of “a certain number” of rare‑earth permits, though uncertainty remains over their timing and scope. Analysts warn that China’s dominance in rare earths gives it “virtually all of the cards.” Until U.S. domestic processing, including new mines and production facilities, catches up, Washington remains reliant on Beijing’s goodwill. While the recent London deal negotiations eased some trade tensions, they leave intact a deeper strategic imbalance. As long as rare‑earth export controls remain unresolved, the truce is likely to remain fragile and tactical, rather than a foundation for sustained economic prosperity.
