Global markets breathed cautious relief as China and the U.S. announced a temporary suspension of tariffs following high-stakes negotiations in Geneva. The 90-day pause, effective May 12, aims to create space for intensified talks between Chinese Vice Premier He Lifeng and U.S. Treasury Secretary Scott Bessent, alongside Trade Representative Jamieson Greer.
The move comes amid mounting warnings from institutions like the International Monetary Fund (IMF), which recently slashed its 2024 global growth forecast to 2.8% — a sharper decline than during the Russia-Ukraine conflict’s economic fallout. IMF analysts attributed the adjustment to rising protectionism, describing tariff escalations as the start of a 'new era' of slowed growth.
Malaysian Prime Minister Anwar Ibrahim underscored regional vulnerabilities, stating: 'When high tariffs are imposed on China, our trade and investment ties are inevitably affected.' As an export-driven economy, Malaysia exemplifies how U.S.-China tensions ripple across Asia’s supply chains.
While the agreement signals potential for stabilizing bilateral relations, economists stress that durable solutions require addressing structural trade issues. The temporary truce could lay groundwork for broader dialogue, but stakeholders from Silicon Valley to Shenzhen await concrete steps toward lasting compromise.
