Washington Update

Two major US semiconductor suppliers on Tuesday announced that US officials had given them permission to resume exporting advanced H20 and MI308 chips to China, reversing a ban imposed in April. In an interview on Tuesday, Treasury Secretary Scott Bessent suggested that the decision was part of trade talks in Geneva and London.

President Donald Trump announced on Tuesday that the United States would impose 50% tariffs on copper and tariffs on pharmaceuticals, potentially at a rate of 200%. While Trump clarified on Wednesday that the copper tariffs begin August 1, the timeline for the tariffs on pharmaceuticals is less clear.

Six Chinese government agencies issued a joint statement on Monday adding two precursor chemicals (4-piperidone and 1-tert-butoxycarbonyl-4-piperidone) to a list of Class Two chemicals that will be subject to tougher supervision starting July 20.

US trade negotiators will meet “soon” with their Chinese counterparts to restart negotiations following a Thursday call between President Donald Trump and President Xi Jinping. It was their first formal contact since Trump’s inauguration and comes as talks have stalled, with both sides accusing the other of breaking with commitments agreed upon last month in Geneva.

The US Court of International Trade on Wednesday struck down President Donald Trump’s tariffs imposed under the International Emergency Economic Powers Act, ruling that the president exceeded his authority. This includes the so-called reciprocal tariffs levied on numerous countries, including China, on April 2; the universal 10% baseline tariff on all other countries; and tariffs on China, Mexico, and Canada related to fentanyl concerns.

Talks between US and Chinese negotiators in Geneva over the weekend were more constructive than anticipated. In a joint statement, the two sides drastically reduced baseline tariffs on the other for 90 days to facilitate further negotiations. The reprieve will bring some relief to US companies and consumers, but tariff rates remain high and negotiators face several obstacles to a durable settlement.

Senior US officials are set to meet with a Chinese trade delegation this weekend in Switzerland. The meetings signal a potential thaw in tensions following weeks of tariff escalation first initiated by the United States.

The Trump administration this week signaled a willingness to soften its tariff stance, offering relief for certain imports while continuing to pursue trade agreements with countries seeking relief from reciprocal duties. Reprieve for China imports, however, remains minimal.

After weeks of aggressive posturing toward China, the Trump administration this week took a softer tone and suggested a willingness to negotiate soon. President Donald Trump on Tuesday said that tariffs on China could come down substantially, though he did not indicate when or to what extent.