Trade war tensions between the United States and China appear to have relaxed significantly. President Donald Trump just said that “a total reset with China” has occurred and the nations have agreed to a 90-day truce with their respective tariffs, effective May 14.
Delegations from the two countries reached an agreement during meetings in Switzerland over the weekend and agreed to lower the levies by 115 per cent each. Trump expects to discuss the situation further with Chinese leader Xi Jinping in the coming days.
The news sent the S&P 500 (INDEXSP: .INX) up by 3.1 per cent Monday afternoon while the Dow Jones Industrial Average (INDEXDJX: .DJI) shot up by 2.8 per cent, gaining over 1,100 points.
This development has also lessened national security fears in the U.S. because obtaining rare earths and critical minerals from China is expected to be become a less difficult task now. This week, two anonymous sources from Beijing informed Reuters that export licenses will become much easier for Chinese suppliers to obtain from the nation’s Ministry of Commerce.
“We are expecting to see an acceleration in the issuance of the required export license and exporters with clients in the U.S. might get a license soon,” one of them explained. However, a complete removal of export controls implemented by the Asian country recently is unlikely.
China has been tightening its grip on critical minerals and rare earth elements since July of 2023, culminating with a total export ban on antimony, germanium, gallium and superhard materials in December of last year. In April this year, export controls were implemented on seven heavy and light rare earths, making Chinese suppliers required to obtain a special export license.
Another one of the last moves was made in February when China added tungsten, molybdenum, indium, tellurium and bismuth to its export control list.
Read more: Promising antimony find in Nevada strongly positions NevGold Corp in minerals race
China cracks down on critical mineral smuggling
The news about Switzerland’s talks follows China launching a campaign to crackdown on the smuggling and illegal exports of ‘strategic’ minerals on Friday before the discussions were held.
“Strengthening export controls on strategic mineral resources is vital to China’s national security and development interests,” Chinese representatives said in Shenzhen.
American government agencies and companies, particularly those involved with the development and production of military technologies, now await more news about the extent that these concerning restrictions will be loosened.
Read more: NevGold’s long intervals of antimony & gold mineralization turn heads
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