Trump announces deal with China after face-to-face talks with Xi in South Korea

US President Donald Trump was returning to Washington after a face-to-face meeting with Chinese leader Xi Jinping on Thursday, the final day of a trip to Asia that provided an opportunity for the leaders of the world’s two largest economies to stabilise relations after months of turmoil over trade issues.

Washington and Beijing are "in agreement on many things", Trump said after the meeting that lasted a little over 100 minutes, with the two leaders emerging from the front door and talking briefly.

Shortly after, both leaders departed the meeting venue, and Trump was back aboard Air Force One to return to the US.

As reporters waited to know the outcome and conclusions of the meeting, Trump promptly announced the US can sign a trade deal with China 'pretty soon.'

What agreements were reached?

And aboard Air Force One, Trump gave more details, telling reporters it was a great meeting with Xi, whom he described as a great leader.

Lowering of tariffs: The United States will immediately lower tariffs on all Chinese goods that were previously implemented in response to the flow of chemical ingredients for fentanyl into the United States," he said.

Trump said tariff rates on imports of Chinese goods would be lowered to 47% and that China would begin purchasing soybeans in bulk, as previously announced, "which I appreciated."

Beijing had faced new tariffs this year totalling 30%, of which 20% has been tied to what Washington claims to be China's role in fentanyl production.

But the tariff rates have been volatile. In April, Trump announced plans to jack the rate on Chinese goods to 145%, only to abandon those plans as markets recoiled.

Rare Earths: No roadblocks from China anymore, Trump says

"All of the rare earth is settled, and that's for the world... This was a worldwide situation and not just a US situation," Trump told reporters. "There's no roadblock from China anymore," the US leader added.

Trump’s aggressive use of tariffs since returning to the White House for a second term, combined with China’s retaliatory limits on exports of rare earth elements, gave the meeting newfound urgency.

There was a mutual recognition that neither side wants to risk blowing up the world economy in ways that could jeopardise their own country’s fortunes.

Xi: US and China should be ‘partners and friends’

Earlier, the Chinese leader spoke for longer than Trump in his opening remarks, saying, “It feels very warm seeing you again because it’s been many years.”

“We do not always see eye to eye with each other,” Xi said through a translator, adding that “it is normal for the two leading economies of the world to have frictions now and then.”

However, he said, China and the US “are fully able to help each other succeed and prosper together.”

For his part, Trump heaped praise on the Chinese leader and announced that he will travel to China in April. Xi will visit the US "sometime after that," perhaps in Palm Beach, Florida, or Washington, DC, Trump said.

How the bilateral meeting unfolded

Shortly after their handshake meeting in Busan, South Korea, a port city about 76 kilometres south of Gyeongju, the main venue for the Asia-Pacific Economic Cooperation summit, Trump and Xi moved to a room to hold their talks.

“It’s an honour to be with a friend of mine,” Trump said of Xi. He said the two will be having some discussions, but “I think we’ve already agreed to a lot of things.”

Accompanying Trump were trade representative Jamieson Greer, Commerce Secretary Howard Lutnick, Secretary of State Marco Rubio, Treasury Secretary Scott Bessent, White House chief of staff Susie Wiles, and David Perdue, the US ambassador to China.

Despite Trump’s optimism after Thursday's meeting in South Korea, there continues to be the potential for major tensions between the world’s two largest economies.

Both nations are aiming for dominant places in manufacturing, developing emerging technologies such as artificial intelligence.

And with China being the top producer and processor of the rare earth minerals needed to make fighter jets, robots, electric vehicles, and other high-tech products, analysts and experts fear Beijing's potential chokehold on the world economy.