Framing the Framework: What the London Trade Talks Really Tell Us
From June 9 to 10, U.S. and Chinese trade negotiators met in London for what both sides called the first meeting of the Economic and Trade Consultation Mechanism. On paper, this was a diplomatic breakthrough. But what actually emerged was a striking example of how two superpowers can attend the same meeting—and walk away with entirely different stories.
At Far Point Global, we work at the intersection of policy, procurement, and capital. So when a moment like this hits global headlines, we look past the press releases. Our clients depend on us not for political spin, but for actionable intelligence. What really happened in London? And more importantly, what does it mean for everyone who trades, builds, or invests?
One Meeting, Two Narratives
Let’s start with the official version out of Beijing.
According to People’s Daily, the London meeting marked “a new step in resolving bilateral trade issues through equal dialogue.” It emphasized the activation of an institutional “consultation mechanism” first agreed upon during the Geneva trade talks. No mention was made of critical exports, technology curbs, or tariff relief. Instead, the tone was steady and strategic: “Stability in China-U.S. trade is vital to the global economy,” the editorial stated, adding that the mechanism would “help reduce misunderstandings and strengthen cooperation.”
Contrast that with President Trump’s Wednesday morning social media blast:
“DEAL DONE — China will restart magnet exports. Tech curbs lifted. Student visas restored.”
Then came U.S. Commerce Secretary Howard Lutnick, who doubled down on CNBC:
“China is going to approve all applications for magnets from U.S. companies right away.”
That’s a sweeping claim—but it doesn’t appear in any Chinese readout. Instead, Chinese Commerce Ministry spokesman He Yadong offered a much narrower promise:
China would “fully consider the reasonable needs and concerns of all countries in the civilian sector,” and noted that “approval work is being strengthened.”
This divergence isn’t just about messaging—it reflects two fundamentally different negotiation strategies.
Trump Wants Headlines. Xi Wants Time.
The U.S. is pushing for transactional, top-level wins under tight political timelines. Trump faces a self-imposed July 9 deadline to close trade pacts or reinstate sweeping tariffs. In that context, he needs quick deliverables—magnets today, visas tomorrow—to signal momentum. His public comments about a new 55% tariff rate on China (a number derived from mixing old and new duties, including fentanyl-related surcharges) reinforce that he’s willing to make bold, unilateral declarations to shape headlines.
By contrast, Xi Jinping’s strategy is patient, institutional, and long-term. His government didn’t crow about magnets or tariffs. Instead, it emphasized the process: the mechanism, the Geneva origins, and the importance of slow, structured dialogue. Xi broke protocol last week to get on the phone with Trump—something Chinese leaders rarely do—but the message from Beijing is clear: we’re not negotiating under pressure.
As Christopher Beddor of Gavekal Research put it:
“Xi is playing a longer game on U.S.-China trade. His time in office is simply much longer than Trump’s.”
What This Means for Global Trade
If you’re in procurement, supply chain, or finance, the key takeaway from London isn’t the supposed “deal”—it’s the gap in narrative, motivation, and timelines.
The U.S. needs speed.
That creates volatility. Policies can swing with headlines. Tools like export controls—once considered off-limits due to national security—are now bargaining chips. The Trump team even floated unwinding tech curbs in exchange for critical minerals, signaling a shift from ideology to dealmaking.
China needs flexibility.
It wants to avoid new tariffs, preserve leverage over rare earths, and wait to see how tough the U.S. will be with other partners. As Arthur Kroeber of Gavekal noted, “The Chinese incentive is to keep cards close to their chest, and not make a lot of proclamations.”
The rare earths licensing game is a perfect case study. Beijing might approve just enough shipments to avoid being accused of blocking trade—but not enough to allow U.S. firms to stockpile. That preserves future leverage without looking obstructionist.
The Real London Outcome: A Fragile Framework
So was a deal struck in London? Yes—but only in the loosest sense. As Zhu Junwei of Beijing’s Grandview Institution (and formerly of the PLA) put it:
“It’s better to have a framework than to have nothing.”
But here’s what you should watch for:
No binding enforcement: Neither side published a detailed readout. That makes it impossible to verify commitments.
No tariff relief (yet): The “London Framework” does not include any suspension of the pending 145% tariff package—Trump’s 90-day pause is still set to expire in August.
No clarity on rare earths: U.S. companies say they need magnet supplies now. China says it will “consider applications.” That’s a bureaucratic middle ground—not a pipeline.
Far Point Global’s View
If you’re a global buyer of Chinese components—especially in metals, electronics, or specialty manufacturing—you should treat London as an easing of tone, not a shift in reality. Customs delays, permit reviews, and policy reversals remain likely in the months ahead. Supply risk remains elevated.
But here’s the good news: the mechanism now exists. That reduces the chance of a total breakdown. And if you’re working with a trade partner that understands the back channels and the real power dynamics—like we do at Far Point Global—you’re better positioned to navigate the fog.
The real story of London isn’t what was agreed. It’s how each side is telling the story. That’s the signal—and everything else is noise. Let us know if you want a deeper dive into how this affects your business, or if you’d like to explore alternatives to sensitive Chinese supply chains. We’re watching this closely—so you don’t have to.