Dear Focus Reader,

This week, trade negotiators from the United States and China convened in Stockholm for a third round of talks aimed at averting a sharp escalation in tariffs set to resume on August 12. The meetings were hosted at the office of Swedish Prime Minister Ulf Kristersson and with U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng as lead negotiators.

Following two days of discussions, both sides described the talks as candid and constructive. China's Ministry of Commerce said the two countries had agreed to work on extending the 90-day pause on elevated tariffs that was first negotiated in May. However, Bessent emphasized that no agreement had been finalized and that any extension would require direct approval from President Donald Trump, who is expected to be briefed by the U.S. delegation this week.

On the Chinese side, Vice Premier He emphasized the mutual benefits of a stable trade relationship, saying a steady U.S.-China economic and trade partnership supports both nations' goals and promotes global economic stability.

During the meetings, the delegations also addressed a range of economic and strategic issues. The U.S. side raised concerns about China's energy trade with Iran, the export of dual-use technologies that could support Russia, and industrial overcapacity in certain sectors. Bessent reiterated U.S. objectives to reduce risk in key supply chains, such as semiconductors, rare earths, and pharmaceuticals, while aiming to increase domestic production and address the bilateral trade imbalance.

Following the negotiations, President Trump issued a sweeping executive order establishing new tariffs on imports from more than 60 trading partners, excluding China. Most of the duties will take effect on August 7, but some, including goods from Canada, become effective today. Rates range from a baseline 10% up to 41% for countries like Syria and 39% for Switzerland, and Canada faces a new 35% tariff on goods not covered by the USMCA.

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