Trump Alleges China Breached Tariff De-Escalation Agreement

U.S.–China Trade Tensions Resurface as Trump Accuses Beijing of Breaching Tariff Deal

U.S. President Donald Trump reignited trade tensions with China on Friday, claiming that Beijing had “totally violated” a tariff de-escalation agreement, though he said he still expects to speak with Chinese President Xi Jinping. His remarks followed U.S. Treasury Secretary Scott Bessent’s comments to Fox News that trade talks with China were “a bit stalled.”

The two countries had agreed earlier this month in Geneva to a 90-day pause on escalating tariffs, with both sides pledging temporary reductions. However, Trump alleged on Truth Social that “China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US,” offering no specifics.

According to the Wall Street Journal, the impasse stems in part from Beijing’s slow approval of export licenses for rare earths and other strategic materials. These exports were a key element of the agreement, which aimed to ease access to components vital to industries like automotive and semiconductor manufacturing.

U.S. Trade Representative Jamieson Greer criticized China's “slow-rolling” compliance, telling CNBC that Washington hasn’t observed significant behavioral shifts and continues to face an “enormous” trade deficit.

Deputy Chief of Staff Stephen Miller echoed the frustration, warning that China’s failure to follow through on commitments “opens up all manner of action for the United States to ensure future compliance.”

Despite the tension, Trump expressed optimism, stating, “I'm sure that I'll speak to President Xi, and hopefully we'll work that out.”

Markets showed uncertainty throughout the day, with mixed closures amid concerns of a renewed hardline approach to China.

Meanwhile, the U.S. is pursuing trade deals elsewhere. Greer confirmed “intensive talks” with several partners including Malaysia, Vietnam, and the EU, with discussions continuing at the OECD summit in Europe. Progress is also being made with Japan, according to Japanese envoy Ryosei Akazawa, who anticipates further talks before mid-June.

However, Trump’s tariff strategy faces legal hurdles. A U.S. trade court recently ruled that he overstepped executive powers in justifying certain broad tariffs under emergency authority. While that decision has been paused pending appeal, it blocked the most expansive tariffs Trump has enacted since returning to office.

Despite the recent de-escalation, steep tariffs remain. U.S. levies on Chinese goods are still significantly higher, partly due to a 20% tariff linked to Trump’s accusation that China is tied to the illicit drug trade—an allegation Beijing denies.

These high tariffs have led many businesses to suspend shipments, waiting to see whether a more durable trade accord emerges.