U.S. Trade Representative Jamieson Greer told CNBC on Friday that there were new developments in negotiations between the world’s two largest economies, with the U.S. and China reaching an agreement covering some goods that they can trade on more favorable terms.
“We have actually come to an agreement with the Chinese side on a number of these points,” Greer said on CNBC’s “Squawk Box,” referring to products such as U.S. agricultural products and medical equipment, as well as Chinese consumer goods that are considered non-sensitive.
Greer said the Trump administration plans to release “many more details” on Monday about what the two countries have achieved in negotiations over the past few weeks. He said the goal is to open up areas of trade that can remain insulated from future tariff measures or broader trade disputes.
Both countries want some goods to be traded on a “more preferential basis” and could potentially be put on hold if either country imposes new tariffs.
Gurría did not say on Friday which products would be covered by the deal, how tariffs on those products might change or when the new terms would take effect. Greer said negotiations under the new U.S.-China “trade commission” mechanism focused on “pure trade issues” rather than U.S. national security restrictions on advanced technology.
“We will take any export controls that pose a national security issue off the table,” Greer said.
After meeting in Beijing in May, Trump and Xi announced the creation of a “trade commission” to manage trade between the two rivals in non-sensitive products. Businesses are awaiting further details on what areas of trade will be eligible for tariff reductions under the new framework.
The news comes as the United States and China also agreed to extend a broad trade ceasefire by two months, giving the two countries more time to negotiate over their long-standing economic dispute.
Greer said Friday that the U.S. is viewing the next two months as a “compliance period” to assess whether China is making good on previous commitments, including purchasing U.S. soybeans and other agricultural products and accessing rare earths needed by U.S. manufacturers.
“Each time these compliance periods overlap, it’s a time to assess, reevaluate and decide whether to continue this period of relative economic peace with China,” Greer said.
Meanwhile, tariffs have significantly changed the flow of U.S. trade. Greer said Friday that the U.S. goods trade deficit with China has fallen by nearly 40%, acknowledging that some trade is shifting to other countries as companies adjust their supply chains.
Mexico is one of the countries benefiting from that change. U.S. imports from Mexico reached a record $60.6 billion in July, according to the Census Bureau. The seasonally adjusted U.S. goods deficit with Mexico increased by $7.2 billion in the month to $27.5 billion, according to the Census Bureau.
“When you impose tariffs, you see market players start doing what market players do, which is responding to new terms of trade and responding to new market incentives,” Greer said. “We’re actually seeing a lot of people coming back to North America.”
Greer’s comments also provided new details from the U.S. side after Thursday’s meeting between Trump and Xi at the White House. The Chinese government has so far released a more detailed official report of the talks than the US government.
Chinese state media reported that President Xi told President Trump on Thursday that artificial intelligence offers greater opportunities for U.S.-China cooperation than for competition.
“The two countries can continue the AI dialogue, exchange views on risks and benefits, and jointly protect against misuse and malicious use of AI,” Xi said, according to a translation of a readout by CNBC.
Trump said in a post on Truth Social Friday morning that his meeting with Xi was “very productive,” and that the Chinese leader seemed to embrace Trump’s preferred term for artificial intelligence as “superintelligence.”
“Something extraordinary is going to happen,” President Trump wrote.
