China, US agree to trade councils and reciprocal tariff cuts

China and the United States have agreed to establish trade and investment councils and committed in principle to reciprocal tariff reductions, signalling a step toward stabilising economic ties between the world’s two largest economies.

According to a statement released Saturday, May 16, by China’s Ministry of Commerce, cited by Chinese media, “The two sides will use the Trade Council as a forum to discuss issues such as tariff reductions on specific products,” though no further details were provided.

The ministry said the two countries also made progress in agricultural trade and aviation cooperation. Both sides agreed to reduce non-tariff barriers on certain agricultural goods, including Chinese seafood and dairy products as well as American beef and poultry. They also committed to expanding bilateral agricultural trade through mutual tariff reductions on a defined range of products.

In the aviation sector, the statement confirmed arrangements covering China’s purchase of US aircraft and Washington’s commitment to ensure the supply of jet engines and components. “The two sides have reached arrangements on China’s purchase of aircraft from the US and the US ensuring the supply of aircraft engines and components to China, and agreed to continue advancing cooperation in related areas,” the ministry said.

Earlier, US President Donald Trump stated that China had agreed to purchase at least 200 commercial aircraft from Boeing, with the possibility of increasing the number to as many as 750 if certain conditions are met. He added that a deal involving the purchase of up to 450 aircraft engines from General Electric had also been reached during his state visit to Beijing.

The visit, the first by a US president to China in nearly nine years, followed last year’s unprecedented tariff war, during which both sides imposed triple-digit tariffs on each other’s goods and introduced export controls on semiconductors and rare earth elements amid intensifying technological competition.

During the visit, the two countries agreed to pursue a “constructive and strategically stable” bilateral relationship. Chinese President Xi Jinping said during a meeting with Trump on Thursday that this approach would provide strategic guidance in the coming years, according to the state-run Xinhua news agency.

“The essence of China-US economic and trade relations is mutual benefit and win-win outcomes. In the face of differences and frictions, equal consultation is the only correct choice,” Xi said.

Trump said on Friday that the two countries have “made some fantastic trade deals, great for both countries.”

By Tamilla Hasanova