On May 12, the United States and China reached an agreement during a ministerial-level meeting held in Geneva, Switzerland, to temporarily suspend the retaliatory tariffs imposed on each other for a period of 90 days. According to the joint statement issued, the U.S. will reduce tariffs on Chinese goods from 145% to 30%, while China will lower its tariffs on American imports from 125% to 10%. The two nations will continue negotiations during this window, aiming to explore the potential for further trade adjustments.
This temporary tariff relief is expected to stimulate an immediate recovery in trade and logistics, particularly impacting the transportation, retail, and consumer goods sectors. In China, a substantial number of containers have already been loaded, and shipping volume to the U.S. West Coast is anticipated to surge over the next four to six weeks.
However, the 30% tariff rate remains a substantial burden on corporate profitability. In response to rising costs, many retailers are already revising prices and reassessing cost structures. Without a permanent reduction in tariff levels, pressure on global supply chains is likely to persist.
In response to the agreement, the White House described it as “a historic trade win for the United States.” In its official statement, it noted: “For too long, unfair trade practices and America’s massive trade deficit with China have fueled the offshoring of American jobs and the decline of our manufacturing sector. This trade deal is a win for the United States, demonstrating President Trump’s unparalleled expertise in securing deals that benefit the American people.”
The specific terms of the agreement include a partial rollback of tariffs imposed since April 2025 while retaining a baseline tariff of 10%. China also agreed to suspend certain non-tariff measures regarded as retaliatory. Meanwhile, the U.S. will continue to enforce Section 301 and 232 tariffs, as well as measures related to the fentanyl crisis.
Future talks will be led by Chinese Vice Premier He Lifeng, U.S. Treasury Secretary Scott Bessent, and U.S. Trade Representative Jamieson Greer. Negotiations are set to be held alternately between both countries or in a mutually agreed third nation.
Nevertheless, challenges remain in the logistics sector. As of the 16th week of 2025, blank sailings in the trans-Pacific route reached 42%, signaling a significant reduction in shipping capacity. With demand expected to rise in response to tariff relief, concerns over rate increases and space shortages are mounting.
Given these developments, the 90-day measure is likely to provide short-term stabilization in the market. However, under the prevailing uncertainty of tariff policy, business decision-making and risk management remain constrained. Building a long-term, sustainable trade framework with key partners, including China, will be essential for businesses to formulate mid- to long-term strategies. Whether this limited window can be leveraged to achieve a more fundamental and lasting agreement remains a critical issue going forward.
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