President Donald Trump has declared a “total reset” in trade relations between the United States and China following high-level talks over the weekend in Switzerland.

The agreement marks a significant step toward easing tensions between the world’s two largest economies.

The deal includes substantial tariff suspensions for 90 days on both sides. The U.S. will cut its duties on Chinese goods from 145% to 30%, while China will lower its retaliatory tariffs on American imports from 125% to 10%.

While there is no clear indication of a start date, many of Trump’s measures have taken effect almost immediately.

Under the new agreement, the U.S. will reduce the Liberation Day tariff to 10%, though it will be suspended for 90 days rather than eliminated outright. A 20% levy targeting China’s role in fentanyl trafficking will remain.

China, in turn, will suspend or remove all non-tariff barriers and will mirror the 10% suspended rate on its own retaliatory measures. However, sector-specific tariffs, including those on steel and automobiles, will remain intact.

President Trump warned that suspended tariffs could be reinstated if no further progress is made in the next three months. “We’re not looking to hurt China,” he said. “But China is being hurt very badly.”

We can probably expect a spike in transpacific shipping demand following the announcement and freight rates potentially rising, especially since carriers had already planned increases this month.

The team at Atlantic Pacific will be keeping a close eye on developments. Should you require further information on the above, then please do not hesitate to contact us.