China Eases Rare Earth Restrictions, Examines US Chip Firms
The White House announced that China will effectively suspend the implementation of additional export controls on rare earth metals and will terminate investigations targeting US companies in the semiconductor supply chain. The White House released a fact sheet on Saturday detailing aspects of the trade pact reached earlier this week by President Donald Trump and Chinese leader Xi Jinping, which seeks to alleviate tensions between the world’s largest economies. According to the White House, under the deal, China will issue general licenses that will be valid for the export of rare earths, gallium, germanium, antimony, and graphite “for the benefit of US end users and their suppliers around the world,” signifying the effective removal of controls that China had imposed in April 2025 and October 2022. The US and China had previously stated that Beijing would delay the implementation of more restrictive controls, which were announced in October 2025, for a period of one year.
Washington will also pause some of Trump’s so-called reciprocal tariffs on China for an additional year and is halting plans to implement a 100 per cent tariff on Chinese exports to the US that was threatened for November. The White House announced that the United States will extend the expiration of specific Section 301 tariff exclusions, which are set to expire on November 29, 2025, until November 10, 2026. The Chinese Embassy in Washington has yet to provide a response to a request for comment made on Saturday. The landmark summit between Trump and Xi, marking their first face-to-face meeting of the US president’s second term, resulted in the leaders stabilizing relations in the short term following an escalating trade conflict that had unsettled markets and raised concerns of a global downturn.
As per the White House’s statement, China has consented to halt extensive restrictions on rare-earth magnets in return for the United States’ commitment to retract an increase in limitations on Chinese firms. China leveraged its dominance in the processing of rare-earth minerals, issuing threats to restrict their flow to the US and allied countries. The US has also consented to reduce a fentanyl-related tariff to 10 percent from 20 percent, while Beijing will restart its purchases of American soybeans and other agricultural products. The US has announced that China is expected to purchase 12 million metric tons of soybeans in the current season, with a commitment to acquire at least 25 million metric tons annually over the next three years. On Friday, Trump expressed a desire to eliminate all fentanyl-related tariffs, contingent upon China’s ongoing efforts to clamp down on exports of the drug and its precursor chemicals. “As soon as we see that, we’ll get rid of the other 10 per cent,” Trump stated.
On Saturday, the US announced that Beijing will implement measures to enable the Chinese facilities of Dutch chipmaker Nexperia BV to restart shipments, corroborating a report from the previous day. This action is expected to alleviate concerns regarding chip shipments that had jeopardized auto production amid the escalating trade conflict between China and the US. While the agreement has eased tensions, it may represent a temporary truce in a prolonged trade conflict, with the measures intended to be in effect for only one year. Despite addressing some key issues — and with both sides winning key concessions — the agreement does not comprehensively tackle all of the core issues at the heart of the US-China trade conflict and other geopolitical flashpoints, including Taiwan and Russia’s war in Ukraine. Trump has approved a plan for an American consortium to acquire the US operations of ByteDance Ltd.’s TikTok app; however, formal approval from Beijing for that sale is still pending. The US president has stated that there will be collaboration on energy, noting that China has consented to purchase oil and gas from Alaska.
