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U.S., South Korea Seal $350 Billion Deal as Trump and Xi Open Talks on Trade Truce

Negotiators set the stage for a pause in new tariffs, with a one‑year halt to Chinese rare‑earth curbs tied to scrapping a planned 100% U.S. hike under review.

Overview

  • South Korea’s package lowers reciprocal tariffs to 15% and comprises $200 billion in financial investment plus $150 billion in shipbuilding cooperation.
  • Trump said he approved South Korea to build nuclear‑powered submarines, a change from its diesel fleet that Seoul argues would strengthen maritime deterrence.
  • Trump and Xi began talks in Busan focused on tariffs, fentanyl‑related measures, access to rare earths, and possible Chinese purchases of U.S. agricultural goods.
  • A framework hammered out in Malaysia envisions the U.S. shelving an added 100% tariff as China delays rare‑earth export controls for a year, pending leader approval.
  • Trump indicated he could cut a 20% fentanyl‑linked tariff if Beijing curbs precursor exports, and officials are weighing an extension of the current tariff pause.