Trade talks set to start in London after Trump says China will resume rare earths minerals export

TOP U.S. and Chinese officials will sit down in London on Monday (June 9) for talks aimed at defusing the high-stakes trade dispute between the two superpowers that has widened in recent weeks beyond tit-for-tat tariffs to export controls over goods and components critical to global supply chains.

AI Brief

Trump and Xi held their first post-inauguration call, focusing on trade and tensions over Taiwan.
China agreed to resume rare earth exports, easing global supply chain issues and boosting markets.
Broader issues like Taiwan, fentanyl, and trade practices remain unresolved ahead of more talks.

The second-round of meetings comes four days after Trump and Chinese leader Xi Jinping spoke by phone, their first direct interaction since Trump's January 20 inauguration.

During the more than one-hour-long call, Xi told Trump to back down from trade measures that roiled the global economy and warned him against threatening steps on Taiwan, according to a Chinese government summary.

But Trump said on social media the talks focused primarily on trade led to "a very positive conclusion," setting the stage for Monday's meeting in London.

The next day, Trump said Xi had agreed to resume shipments to the U.S. of rare earths minerals and magnets. China's decision in April to suspend exports of a wide range of critical minerals and magnets upended the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world.

That had become a particular pain point for the U.S. in the weeks after the two sides had struck a preliminary rapprochement in talks held in Switzerland.

There, both had agreed to reduce steep import taxes on each other's goods that had had the effect of erecting a trade embargo between the world's No. 1 and 2 economies, but U.S. officials in recent weeks accused China of slow-walking on its commitments, particularly around rare earths shipments.

That preliminary deal sparked a global relief rally in stock markets, and U.S. indexes that had been in or near bear market levels have recouped the lion's share of their losses. Still, that temporary deal did not address broader concerns that strain the bilateral relationship, from the illicit fentanyl trade to the status of democratically governed Taiwan and U.S. complaints about China's state-dominated, export-driven economic model.

While the UK government will provide a venue for Monday's discussions, it will not be party to them but will have separate talks later in the week with the Chinese delegation.