In a possible step toward easing tensions in the ongoing U.S.-China trade war, China has reportedly exempted select American products from its steep retaliatory tariffs. While this move sparked hope that a truce might be on the horizon, conflicting signals from both sides suggest the situation remains far from resolved.
On Friday, several U.S. business groups confirmed that China had allowed certain U.S.-made pharmaceuticals to enter the country without being subjected to the newly imposed 125% tariffs. These duties had been enacted earlier this month in response to the Trump administration’s aggressive 145% tariff hike on Chinese imports.
Although a list of 131 U.S. product categories rumored to be up for exemption—including vaccines, chemicals, and jet engines—has been circulating among trade circles, it remains unverified. China has yet to make any public statement confirming such exemptions or the full extent of their application.
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U.S. President Donald Trump, speaking to TIME magazine, asserted that trade negotiations with China were underway and even claimed that Chinese President Xi Jinping had personally called him. “I don’t think it’s a sign of weakness on his behalf,” Trump said of Xi.
However, Chinese officials quickly refuted those claims. In a firm statement posted on social media, the Chinese Embassy in Washington declared: “China and the US are NOT having any consultation or negotiation on tariffs. The US should stop creating confusion.”
This contradictory messaging highlights the uncertainty that continues to cloud global markets and trade policy watchers.
In addition to targeting China, Trump has announced sweeping tariffs on dozens of other countries, although those levies have been temporarily suspended until July 9.
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This temporary pause has sparked a race among America’s trading partners to secure bilateral deals with Washington—a daunting task given the complexity and typical timeline of trade negotiations.
One such country is Japan. Trump recently stated that he was close to finalizing a trade agreement with Japanese Prime Minister Shigeru Ishiba.
The potential pact is expected to be announced during the upcoming G7 Summit in Canada this June and is seen by analysts as a test case for Trump’s broader bilateral trade strategy.
Meanwhile, Trump also told TIME he has made “200 deals” set to be finalized within the next few weeks, though he offered no further details. He added that he would consider it a “total victory” if U.S. tariffs remain between 20% to 50% a year from now.
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The Trump administration maintains that its aggressive tariff regime is designed to protect and revive American manufacturing by leveling the playing field against foreign competitors. The U.S. Trade Representative’s office even reported a “productive meeting” with South Korea, hinting at further bilateral negotiations.
Still, many economists warn that these tariffs could ultimately backfire—leading to increased prices for American consumers, disruptions in supply chains, and potentially triggering a recession.
In addition to country-specific tariffs, the administration has imposed a blanket 10% duty on all other U.S. imports, with even higher levies on key sectors such as steel, aluminum, and automobiles. Industry-specific tariffs on pharmaceuticals and semiconductors are also reportedly being considered.
While China’s gesture of tariff exemptions offers a glimmer of hope, the absence of clear, consistent communication between Washington and Beijing continues to sow confusion. For now, the global economy remains caught in the crossfire of uncertain trade diplomacy, with businesses, consumers, and governments alike holding their breath for the next move.
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