US and China set to meet for trade talks in London

A new round of talks aimed at resolving a trade war between the US and China is set take place in London on Monday.

US President Donald Trump announced on Friday that a senior US delegation would meet Chinese representatives. Over the weekend, Beijing confirmed that Vice Premier He Lifeng will attend the talks.

The announcements came after Trump and China’s leader Xi Jinping had a phone conversation last week, which the US president described as a “very good talk”.

Last month, the world’s two biggest economies agreed a temporary truce to lower import taxes on goods being traded between them, but since then both countries have accused the other of breaching the deal.

Trump said US Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer would meet Chinese officials in London on Monday.

On Saturday, China’s foreign ministry said Vice Premier He would be in the UK between 8 and 13 June, and that a meeting of the “China-US economic and trade mechanism” would take place.

The new round of negotiations came after Trump said his phone conversation with Xi on Thursday mainly focused on trade and had “resulted in a very positive conclusion for both countries”.

According to Chinese state news agency Xinhua, Xi told Trump that the US should “withdraw the negative measures it has taken against China”.

The call was the first time the two leaders had spoken since the trade war erupted in February.

When Trump announced sweeping tariffs on imports from a number of countries earlier this year, China was the hardest hit. Beijing responded with its own higher rates on US imports, and this triggered tit-for-tat increases that peaked at 145%.

In May, talks held in Switzerland led to a temporary truce that Trump called a “total reset”.

It brought US tariffs on Chinese products down to 30%, while Beijing slashed levies on US imports to 10% and promised to lift barriers on critical mineral exports.

The US had suspended sales of some technology to China including semiconductors while Beijing had restricted exports of rare earth minerals and magnets.

Swetha Ramachandran, fund manager at Artemis, told the BBC’s Today programme that the inclusion of Lutnick in the talks was a “welcome addition” since he was “behind some of the very harsh export controls of technology to China”.

“And some of the focus certainly seems to be on rare earths where China, of course, has dominance in terms of producing,” she said.

“They mine 69% of the rare earths globally that are quite essential to technology development in the US so I think there are enough chips on the table here that could make it acceptable for both sides to walk away with desired outcomes.”

The agreement made in May gave both sides a 90-day deadline to try to reach a trade deal.

The latest data released by Bejing on Monday showed China’s exports in May were lower than analysts expected, despite the truce.

China’s exports in dollar terms increased by 4.8% compared to the same time last year.

At the same time imports dropped by 3.4%, which was much worse than the 0.9% fall predicted.

But since then, relations appeared to have soured. Last month, Trump said China had “totally violated its agreement with us”, and then a few days later China said the US had “severely violated” the agreement.

The US accused China of failing to restart shipments of critical minerals and rare earth magnets vital to car and computer industries.

On Saturday, the Chinese Ministry of Commerce said it had approved some applications for rare earth export licences, although it did not provide details of which countries involved.

The announcement came after Trump said on Friday that Xi had agreed to restart trade in rare earth materials.

Bu speaking on Sunday, White House National Economic Council Director Kevin Hassett told CBS News that “those exports of critical minerals have been getting released at a rate that is, you know, higher than it was, but not as high as we believe we agreed to in Geneva”.