Senior U.S. and Chinese negotiators have agreed on a framework to get their trade negotiations back on track after a series of disputes that threatened to derail them, both sides have said.

The announcement came at the end of two days of talks in the British capital that wrapped up late Tuesday.

The meetings appeared to focus on finding a way to resolve disputes over mineral and technology exports that had shaken a fragile truce on trade reached in Geneva last month. It’s not clear whether any progress was made on the more fundamental differences over China’s sizeable trade surplus with the United States.

“First we had to get sort of the negativity out and now we can go forward,” U.S. Commerce Secretary Howard Lutnick told reporters after the meetings.

Asian stock markets rose Wednesday after the agreement was announced.

The talks followed a phone call between President Donald Trump and Chinese leader Xi Jinping last week to try to calm the waters.

Li Chenggang, a vice minister of commerce and China’s international trade representative, said the two sides had agreed in principle on a framework for implementing the consensus reached on the phone call and at the talks on Geneva, the official Xinhua News Agency said.

Further details, including any plans for a potential next round of talks, were not immediately available.

Li and Wang Wentao, China’s commerce minister, were part of the delegation led by Vice Premier He Lifeng. They met with Lutnick, Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer at Lancaster House, a 200-year-old mansion near Buckingham Palace.

Wendy Cutler, a former U.S. trade negotiator, said the disputes had frittered away 30 of the 90 days the two sides have to try to resolve their disputes.

They agreed in Geneva to a 90-day suspension of most of the 100%-plus tariffs they had imposed on each other in an escalating trade war that sparked fears of recession. The World Bank, citing a rise in trade barriers, cut its projections Tuesday for U.S. and global economic growth this year.

“The U.S. and China lost valuable time in restoring their Geneva agreements,” said Cutler, now vice president at the Asia Society Policy Institute. “Now, only sixty days remain to address issues of concern, including unfair trade practices, excess capacity, transshipment and fentanyl.”

Since the Geneva talks, the U.S. and China have exchanged angry words over advanced semiconductors that power artificial intelligence, visas for Chinese students at American universities and rare earth minerals that are vital to carmakers and other industries.

China, the world’s biggest producer of rare earths, has signaled it may speed up the issuing of export licenses for the elements. Beijing, in turn, wants the U.S. to lift restrictions on Chinese access to the technology used to make advanced semiconductors.

Lutnick said that resolving the rare earths issue is a fundamental part of the agreed-upon framework, and that the U.S. will remove measures it had imposed in response. He did not specify which measures.

“When they approve the licenses, then you should expect that our export implementation will come down as well,” he said.

Cutler said it would be unprecedented for the U.S. to negotiate on its export controls, which she described as an irritant that China has been raising for nearly 20 years.

“By doing so, the U.S. has opened a door for China to insist on adding export controls to future negotiating agendas,” she said.

In Washington, a federal appeals court agreed Tuesday to let the government keep collecting tariffs that Trump has imposed not just on China but also on other countries worldwide while the administration appeals a ruling against his signature trade policy.

Trump said earlier that he wants to “open up China,” the world’s dominant manufacturer, to U.S. products.

“If we don’t open up China, maybe we won’t do anything,” Trump said at the White House. “But we want to open up China.”

This story was originally featured on Fortune.com

© Li Ying—Xinhua via AP

U.S.-China trade talks in London this week are expected to take up a series of fresh disputes that have buffeted relations, threatening a fragile truce over tariffs.

Both sides agreed in Geneva last month to a 90-day suspension of most of the 100%-plus tariffs they had imposed on each other in an escalating trade war that had sparked fears of recession.

Since then, the U.S. and China have exchanged angry words over advanced semiconductors that power artificial intelligence, “rare earths” that are vital to carmakers and other industries, and visas for Chinese students at American universities.

President Donald Trump spoke at length with Chinese leader Xi Jinping by phone last Thursday in an attempt to put relations back on track. Trump announced on social media the next day that trade talks would be held on Monday in London.

Technology is a major sticking point

The latest frictions began just a day after the May 12 announcement of the Geneva agreement to “pause” tariffs for 90 days.

The U.S. Commerce Department issued guidance saying the use of Ascend AI chips from Huawei, a leading Chinese tech company, could violate U.S. export controls. That’s because the chips were likely developed with American technology despite restrictions on its export to China, the guidance said.

The Chinese government wasn’t pleased. One of its biggest beefs in recent years has been over U.S. moves to limit the access of Chinese companies to technology, and in particular to equipment and processes needed to produce the most advanced semiconductors.

“The Chinese side urges the U.S. side to immediately correct its erroneous practices,” a Commerce Ministry spokesperson said.

U.S. Commerce Secretary Howard Lutnick wasn’t in Geneva but will join the talks in London. Analysts say that suggests at least a willingness on the U.S. side to hear out China’s concerns on export controls.

China shows signs of easing up on rare earths

One area where China holds the upper hand is in the mining and processing of rare earths. They are crucial for not only autos but also a range of other products from robots to military equipment.

The Chinese government started requiring producers to obtain a license to export seven rare earth elements in April. Resulting shortages sent automakers worldwide into a tizzy. As stockpiles ran down, some worried they would have to halt production.

Trump, without mentioning rare earths specifically, took to social media to attack China.

“The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US,” Trump posted on May 30.

The Chinese government indicated Saturday that it is addressing the concerns, which have come from European companies as well. A Commerce Ministry statement said it had granted some approvals and “will continue to strengthen the approval of applications that comply with regulations.”

The scramble to resolve the rare earth issue shows that China has a strong card to play if it wants to strike back against tariffs or other measures.

Plan to revoke student visas adds to tensions

Student visas don’t normally figure in trade talks, but a U.S. announcement that it would begin revoking the visas of some Chinese students has emerged as another thorn in the relationship.

China’s Commerce Ministry raised the issue when asked last week about the accusation that it had violated the consensus reached in Geneva.

It replied that the U.S. had undermined the agreement by issuing export control guidelines for AI chips, stopping the sale of chip design software to China and saying it would revoke Chinese student visas.

“The United States has unilaterally provoked new economic and trade frictions,” the ministry said in a statement posted on its website.

U.S. Secretary of State Marco Rubio said in a May 28 statement that the United States would “aggressively revoke visas for Chinese students, including those with connections to the Chinese Communist Party or studying in critical fields.”

More than 270,000 Chinese students studied in the U.S. in the 2023-24 academic year.

This story was originally featured on Fortune.com

© Chinatopix Via AP