Sun Jun 15 07:29:32 UTC 2025: **Summary:**

The United States and China have reached a new trade truce in London, but unresolved issues remain, particularly regarding export restrictions. The U.S. wants China to ease restrictions on rare-earth magnets needed for military suppliers, while China seeks the lifting of U.S. curbs on advanced AI chips. U.S. officials are considering extending existing tariffs, making a comprehensive deal unlikely soon. Despite positive comments from President Trump, challenges persist due to China’s control over rare earths and the difficulty in resolving fundamental trade imbalances.

**News Article:**

**U.S.-China Trade Truce Falters Over Export Control Disputes: Future of Deal Uncertain**

**BEIJING/SINGAPORE (June 15, 2025)** – A newly brokered U.S.-China trade agreement, reached in London, is already showing signs of strain due to lingering disagreements over export restrictions, according to sources familiar with the discussions. While the deal aimed to build on progress made last month in Geneva, key sticking points remain that could jeopardize a comprehensive, long-term resolution.

At the heart of the matter are U.S. concerns over China’s restrictions on rare-earth magnet exports, critical for U.S. military suppliers manufacturing fighter jets and missile systems. In parallel, China seeks the lifting of U.S. export controls on advanced artificial intelligence (AI) chips, arguing these restrictions hinder its technological advancement.

During the London talks, Chinese negotiators appeared to link the two issues, signaling a potential quid pro quo – easing rare-earth exports in exchange for relaxed AI chip controls. However, U.S. Treasury Secretary Scott Bessent has denied any such exchange.

Furthermore, U.S. officials are reportedly considering extending existing tariffs on Chinese goods for another 90 days beyond the August 10th deadline, suggesting a lack of confidence in achieving a more permanent trade agreement in the near future.

“Temporary mutual accommodation of some concerns is possible, but the fundamental issue of the trade imbalance cannot be resolved within this timeframe,” stated Liu Weidong, a U.S.-China expert at the Institute of American Studies, Chinese Academy of Social Sciences.

China’s dominance in the global rare-earth market, particularly in refining and processing, provides it with considerable leverage in negotiations. The U.S. has responded to previous restrictions with its own export controls, further escalating tensions.

While initial signals were positive, with some Chinese rare-earths producers obtaining export licenses, the specialized rare earths vital for military applications remain under tight control.

Experts warn that the unresolved issues highlight the difficulties the Trump administration faces in its trade dealings with China, particularly given China’s willingness to use its rare-earth control as a bargaining chip.

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