New Zealand’s Trade and Investment Minister Todd McClay confirmed that negotiations have made steady progress, with both nations committed to crafting an agreement that promotes mutual prosperity and creates new opportunities for businesses and citizens alike.

The update follows recent discussions between India’s Commerce Minister Piyush Goyal and New Zealand’s Prime Minister Christopher Luxon at the India–New Zealand Business Forum, where leaders explored trade diversification, investment, and market access across key sectors including agriculture, technology, and renewable energy.

Officials on both sides have expressed optimism that a successful deal could mark a new era in Indo-Pacific trade relations, strengthening ties between two of the region’s dynamic economies.

The breakthrough came during talks on the sidelines of the ASEAN Summit in Kuala Lumpur, where negotiators reached a provisional understanding to halt escalating trade measures that have unsettled global markets.

Tariffs and Rare Earth Controls Temporarily Suspended

According to U.S. Treasury Secretary Scott Bessent, the framework agreement will prevent the planned 100% tariffs on Chinese imports from taking effect on November 1. In exchange, Beijing is expected to delay implementation of its new licensing regime on rare earth minerals and magnets key materials used in high tech and defense industries for at least one year while the policy is reviewed.

“China is ready to make a deal,” Bessent said, calling the progress “a positive step toward restoring balance and predictability to global trade.”

If finalized, the deal would represent the most significant thaw in U.S.-China trade relations since tensions escalated earlier this year over technology access, investment restrictions, and export controls.

Background: A Longstanding Trade Rivalry

The United States and China have been locked in a protracted trade dispute over market access, intellectual property rights, and strategic technology. Successive rounds of tariffs since 2018 have disrupted supply chains and weighed heavily on both economies.

Washington has accused Beijing of unfair trade practices, while China has criticized U.S. tariffs as protectionist. Despite several rounds of negotiations and temporary truces, lasting progress has proven elusive making the current breakthrough particularly significant.

Global Implications

A formal agreement between the world’s two largest economies could ease pressure on global manufacturing and commodity markets, especially as supply chains continue to recover from pandemic era disruptions. Analysts say a temporary pause in tariff escalation may also boost investor confidence across Asia ahead of the holiday trading season.

Both Trump and Xi are scheduled to meet later this week to finalize the terms of the deal, which could define the next phase of bilateral economic engagement between Washington and Beijing.

The signing ceremony, held before a banner reading “Delivering Peace,” brought together Thai Prime Minister Anutin Charnvirakul and Cambodian Prime Minister Hun Manet, who both agreed to an expanded ceasefire following a deadly five day border conflict that erupted in July.

Trump, who played a direct role in brokering the talks, reportedly warned both nations that ongoing hostilities could jeopardize pending trade negotiations with the United States. His intervention underscores a growing U.S. focus on regional stability and economic cooperation across the Asia-Pacific.

Background: A Fragile Border History

Thailand and Cambodia share a long, complex border that has been the site of periodic clashes for decades most notably near the Preah Vihear temple, a UNESCO World Heritage site claimed by both sides.

Although relations between Bangkok and Phnom Penh have generally improved in recent years, military tensions have occasionally flared, threatening trade and tourism in the region. The July confrontation marked the most serious escalation since 2011, prompting urgent calls for mediation from ASEAN and neighboring states.

Ceasefire Details and Next Steps

The new deal establishes joint border monitoring committees, increased communication between military units, and a framework for economic cooperation zones in contested border areas. Both governments also committed to reopening key checkpoints closed during the July clashes.

According to U.S. officials, the ceasefire forms part of a broader peace and development initiative in the Mekong subregion a zone where Washington, Beijing, and ASEAN nations are competing for influence.

Trump is expected to continue his Asia tour with stops in Japan and Vietnam, where discussions on trade, defense, and regional investment will take center stage. The White House described the ceasefire as “a model for diplomacy that prioritizes peace through prosperity.”

The leaders focused on deepening economic ties and modernizing trade frameworks, with President Trump hinting at a comprehensive deal that could cover key industries including dairy, manufacturing, and energy.

“The United States and Canada are two of the hottest economies in the world,” Trump said during a joint press briefing. “We share values, we share borders, and we’re working toward a trade deal that reflects the strength of our partnership.”

While the meeting marked a continuation of trade discussions, the tone signaled progress. Trump emphasized mutual respect and the need for balanced agreements, stating that “Canadians will be very happy” with the terms being negotiated.

Prime Minister Carney echoed that sentiment, noting that both nations are seeking “durable, fair, and forward looking trade solutions” in an increasingly unstable global economy.

Historical Context

The current talks build on the legacy of previous trade frameworks like the United States-Mexico-Canada Agreement (USMCA), which replaced NAFTA in 2020. While USMCA modernized various aspects of trade especially in digital commerce and automotive content rules it left some sectors, like dairy, contentious between the two nations. Canada’s protected dairy industry has long been a sticking point in bilateral negotiations, something Trump alluded to when referencing “broad” industry coverage.

President Trump, now in his second term, has prioritized renegotiating key trade relationships to favor American industry and reduce trade deficits. Canada remains one of America’s largest trading partners, with over $700 billion in annual bilateral trade.

Though details remain scarce, officials say the next few weeks could be critical in shaping the final terms of a new deal.

Starmer has touted the agreement as a “win-win,” highlighting provisions on fishing, export checks, and a potential youth mobility program as signs of closer cooperation with European neighbors. However, Badenoch and other critics argue that the deal fails to deliver meaningful benefits for the UK and undermines the country’s post-Brexit independence.

Badenoch’s criticism echoes sentiments expressed by former Prime Minister Boris Johnson and other Conservative figures, who have labeled the deal a “surrender” to the EU. Despite the criticism, Starmer noted broad business support for the deal and contrasted his government’s achievements with the Conservative administration’s failure to secure similar trade pacts.

The debate over the trade deal highlights ongoing divisions within British politics regarding the country’s relationship with the EU and the legacy of Brexit. As the government moves forward with the agreement, it remains to be seen how it will impact the UK’s economic and diplomatic standing in the years to come.

Trump’s comments came hours after U.S. Treasury Secretary Scott Bessent called current tariff levels “unsustainable” and said he expects a “de-escalation” in the trade war between the world’s two largest economies.

Under Trump’s latest trade directive, the U.S. imposed 145% import taxes on Chinese goods, prompting Beijing to retaliate with 125% tariffs on U.S. exports. The aggressive tariff regime has impacted global markets, slowed international trade, and triggered investor concerns over rising inflation and borrowing costs in the United States.

“The tariffs are hurting both sides, and neither side thinks the status quo is sustainable,” Bessent reportedly said during a closed-door policy briefing. His remarks, confirmed by two sources familiar with the meeting, were first reported by Bloomberg News and triggered a 2.5% rally in the S&P 500 index.

Despite the market rebound, uncertainty remains high. Economists warn that continued trade tensions may further strain U.S. consumers and exporters already grappling with higher prices and global supply chain disruptions.

Trump, speaking after the ceremonial swearing-in of Paul Atkins as the new chair of the Securities and Exchange Commission, acknowledged the market gains but remained cautious about future negotiations.

“China is going to be a slog in terms of the negotiations,” Bessent added, according to a transcript obtained by the Associated Press.

The White House has not confirmed any formal plans to alter existing tariffs, but analysts say the latest remarks could open the door to renewed talks aimed at easing tensions and stabilizing markets.