GENEVA — In a promising development for global markets, China and the United States announced they had made “substantial progress” following high-level trade talks held this week in Geneva. The discussions, led by Chinese Vice Premier He Lifeng and U.S. Trade Representative officials, were described as “candid, in-depth, and constructive.”

Vice Premier He Lifeng emphasized that the talks marked a “turning point” in recent economic dialogue between the two superpowers. He confirmed that both parties have agreed to establish a joint consultation mechanism aimed at continuing open and structured communication on key trade and economic issues.

“The meeting reflected mutual respect and a shared desire to stabilize and expand our economic relationship,” He said during a press briefing in Beijing.

Though exact details remain undisclosed, sources close to the negotiations indicate that discussions touched on tariff adjustments, intellectual property protections, and supply chain resilience. U.S. officials said the talks created a roadmap for continued cooperation and future agreements.

The two countries, which together account for over a third of global GDP, have had strained economic ties in recent years due to tariff wars, tech disputes, and geopolitical frictions. However, the outcome of the Geneva meeting was hailed by both delegations as “constructive and forward-looking.”

Further discussions are planned in the coming months, with working groups expected to dive deeper into unresolved trade imbalances and strategic concerns.

“Countries that choose to undermine China’s core economic interests by siding with hostile foreign powers will face consequences,” a spokesperson for China’s Ministry of Commerce said Monday, in what many observers interpreted as a direct threat to U.S. allies entering new trade deals with Washington.

The U.S. this month announced a temporary 90-day pause on planned tariff increases for select allied nations, while simultaneously raising tariffs on Chinese goods to a staggering 145% a move Washington says is aimed at countering unfair trade practices and rebalancing global supply chains.

Beijing, however, sees the action as economic containment. “This is not trade policy; it is economic warfare,” Chinese officials said in state media broadcasts, warning that countries signing trade agreements with the U.S. could find themselves locked out of Chinese markets, facing import restrictions, or becoming targets of other “countermeasures.”

The threat places key U.S. partners including South Korea, Australia, and members of the European Union in a difficult position as they attempt to balance their strategic alliances with Washington and their economic ties to Beijing.

The latest flare-up further destabilizes an already fragile global trade environment, with analysts warning of possible supply chain shocks, increased costs for consumers, and the real risk of a fractured global economy.

More responses from U.S. allies and trading partners are expected in the coming days, as nations weigh the cost of choosing sides in a deepening economic standoff between two global superpowers.