PDB Afternoon Bulletin | May 12th, 2025: US-China Agree To Slash Tariffs In Major Trade Breakthrough & White House Secures Release Of American-Israeli Hostage From Hamas Captivity
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What breakthrough occurred in US-China trade relations?
It's Monday, the 12th of May. Welcome to the PDB Afternoon Bulletin. I'm Mike Baker, your eyes and ears on the world stage. All right, let's get briefed. First up, the U.S. and China reached a breakthrough during trade negotiations this weekend. How about that?
How will tariffs change between the US and China?
Agreeing to a 90-day tariff pause that will significantly slash rates, marking a major de-escalation in the economic standoff that has global investors celebrating. Markets are up on the news. We'll have those details. Later in the show, following direct talks between Hamas and the Trump administration, the Iranian-backed terror group unconditionally released American-Israeli hostage Eden Alexander from captivity in Gaza on Monday. But first, today's afternoon spotlight. We'll begin today with a surprise breakthrough regarding US-China relations, as the two global economic powers agreed to substantially roll back tariffs on each other's goods for 90 days, as well as to remove most economic barriers as part of a deal to defuse the trade war.
As we've been tracking here on the PDP, delegations from the US and China met in Geneva this weekend for marathon trade negotiations, and the talks apparently did not disappoint. Both sides agreed to lower their reciprocal tariffs on the other by 115 percentage points for a period of 90 days, during which discussions will continue on securing a long-term trade deal. That's according to a report from NBC News. The announcement, which was made in a rare joint statement released by Washington and Beijing, signaled the short-lived but economically devastating trade war may soon be coming to an end. The temporary pause will effectively lower U.S. tariffs on Chinese goods from 145% to 30%, leaving in place only the 10% baseline tariff that Trump has imposed on all countries, along with the 20% duty imposed on China earlier this year related to fentanyl manufacturing. China will in turn slash its 125% retaliatory tariffs on U.S.
goods to just 10% and will remove all non-tariff countermeasures, such as export restrictions on certain rare earth minerals. In their joint statement, both sides said they recognized, quote, the importance of a sustainable, long-term and mutually beneficial economic and trade relationship, end quote. Oh, just get a room. Many analysts did not expect much to come from this first round of trade talks, which were, as you know, led by Treasury Secretary Scott Besant and Trade Representative Jameson Greer on the U.S. side and top economic star Heilei Feng on the Chinese side. But it appears they overestimated just how much economic punishment China was willing to absorb. As we previously discussed, China's export dependent economy has been battered by the tariffs, which have forced factories across the country to shut down and put as many as 16 million jobs in jeopardy. Secretary Besson remarked that the tariff war had amounted to, quote, the equivalent of an embargo between the US and China that threatened to imperil the global economy.
What are the economic effects of the trade war on China?
Besson said that both sides, quote, concluded that we have a shared interest. The consensus from both delegations is that neither side wanted a decoupling. President Trump echoed that sentiment on Monday, saying, quote, We're not looking to hurt China. The reductions are set to take effect on Wednesday, the 14th of May, at which point both nations have agreed to establish a mechanism to continue discussions about economic and trade relations. The discussions will take place in China, the US and possibly mutually agreed upon third countries.
What is the significance of the BRICS nations' upcoming summit?
Secretary Besson said, quote, I would imagine that in the next few weeks we will be meeting again to get rolling on a more fulsome agreement. Notably, President Trump said Monday that as part of their new understanding, China has agreed to, quote, open up to U.S. businesses, calling it perhaps the, quote, most important thing to come out of the negotiations, though he did not elaborate on the development. Secretary Besson, however, said the communist regime had discussed potential purchase agreements of key American goods, which, if they materialize, could go a long way towards narrowing America's nearly $300 billion trade deficit with China.
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Chapters
6 chapters
1
What breakthrough occurred in US-China trade relations?
0:12–0:28
2
How will tariffs change between the US and China?
0:28–3:18
3
What led to the release of the American-Israeli hostage?
3:18
4
What are the implications of the new US-China trade agreement?
1:37–2:37
5
What are the economic effects of the trade war on China?
2:37–3:49
6
What is the significance of the BRICS nations' upcoming summit?
3:49–14:43
Speakers
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