China - US agree tariff cuts on US$60b of goods as trade truce extended

China and the United States have extended their trade truce until January 10 and reached agreements on tariff cuts for US$60 billion worth of goods, aimed at providing businesses with a more stable policy environment, according to Reuters. Under the deal, each side has recommended $30 billion in non-sensitive goods for more favorable tariff treatment, with the US Trade Representative, Jamieson Greer, stating that the arrangement would improve market access for around 30% of US exports to China.

China plans to cut tariffs on various US agricultural products like corn, wheat, and meat, while the US will reduce tariffs on Chinese consumer goods such as small household appliances, bed linen, and children's car seats. The tariff reductions were part of the key outcomes of last week's summit between Chinese President Xi Jinping and US President Donald Trump.

The trade truce extension provides both sides with more time to assess their existing arrangements and advance negotiations on economic and trade issues, while creating a "relatively stable and predictable policy environment" for business cooperation. The agreement also includes China importing 10 million metric tonnes of US coal annually from 2027 to 2028, which would supplement China's domestic coal market and provide income and employment for the US coal industry.