China and USA reach preliminary agreement

The aim was to implement the consensus reached by the presidents of both countries in their telephone conversation on June 5 and which the negotiators had reached at talks in Geneva in mid-May.

US Secretary of Commerce Howard Lutnick also told reporters in London that a framework had been reached to implement the Geneva agreement, according to media reports. Both delegations now want to present the results negotiated in the British capital to their respective presidents, who must decide on them.

Decision lies with heads of state

As soon as US President Donald Trump and China's head of state and party leader Xi Jinping agree, the agreement will reportedly be implemented. Further details on the content were not initially known.

According to Xinhua, Li described the two-day talks as "professional", "honest" and "reasonable". The hope is that the progress made at the London meeting will strengthen trust between China and the United States, he said.

Further escalation averted?

This suggests a way forward for further de-escalation in the tense trade relations between the world's two largest economies. The 90-day pause in the heated tariff dispute, which has been in place since mid-May, is currently underway. In Geneva, the USA and China agreed to significantly reduce their surcharges on imports from the other country by 115 percentage points from 145% and 125% respectively and to negotiate during the pause.

The meeting in London, on the other hand, focused on export restrictions. In April, China restricted the export of important rare earths and requires a complex application process for export licenses. The USA, on the other hand, restricted the sale of important chip design software and aircraft components to China. It was not initially known when and where the two countries plan to negotiate next.