Trump claims ‘done deal’ with China … but is it, really?

President Donald Trump announced Wednesday that a U.S.-China trade deal is “done” after two days of high-stakes negotiations in London, but observers say it just put Washington in a circle.

The London meetings were prompted by a May agreement in Geneva that temporarily lowered punishing tariffs that had brought trade between the superpowers nearly to a halt. Trump’s April duties had climbed to 145% on most Chinese goods, leaving U.S. businesses that rely on them struggling. The Geneva agreement lowered Trump’s new tariffs to 30% and China’s to 10%, establishing a 90-day window until Aug. 10 for a broader deal.

The arrangement, however, fell apart due to conflicts over rare earth shipments and technology access. Beijing holds dominant market position in rare earth production — materials vital for products from automobiles to military hardware — leading U.S. industries to lobby Washington for action.

After a pivotal phone conversation between Trump and Xi Jinping last week that Commerce Secretary Howard Lutnick said “changed everything,” negotiators reached what officials termed a “framework” during extended talks at London’s Lancaster House. “Our deal with China is done, subject to final approval with President Xi and me,” Trump posted on Truth Social Wednesday, noting that the U.S. will get “a total of 55% tariffs” and China, 10%.

The 55% U.S. tariff structure includes several components: 10% universal duties on most trading partners, 20% penalties aimed at China over fentanyl issues and 25% rates carried over from Trump’s first presidency. The framework calls for China to deliver “full magnets, and any necessary rare earths … up front,” while the U.S. will maintain Chinese student access to American universities.

Treasury Secretary Scott Bessent told lawmakers that “there is no quid pro quo in terms of chips for rare earths.” China’s Commerce Ministry, on the other hand, took a more reserved stance, calling the result a “framework” from the “first meeting” between the parties.

On Thursday, Chinese Foreign Ministry spokesperson Lin Jian confirmed that a consensus has been reached and reiterated that Beijing will always honor its commitments. “It is hoped that the U.S. will work with China to implement the important consensus reached by the two heads of state during their phone call, give full play to the role of the China-U.S. economic and trade consultation mechanism, enhance consensus, reduce misunderstandings and strengthen cooperation through communication and dialogue,” Lin said.

Despite Trump’s positive assessment, analysts are questioning the deal’s substance. It appears the framework only primarily returns both nations to their pre-April status, with elevated tariffs still in effect.

“What exactly are we getting that we weren’t already getting before?” Veronique de Rugy, a senior research fellow with the libertarian think tank Mercatus Center, told The New York Times. “This deal suggests there was never a real plan.” Fundamental trade disagreements — including China’s large trade surplus and intellectual property concerns — remain untouched, while the World Bank this week lowered global growth projections, identifying elevated tariffs as a “significant headwind” for most economies.

The U.S. and Chinese governments must approve the framework before any implementation begins.