By CHRISTOPHER BODEEN

TAIPEI, Taiwan (AP) — A 90-day pause on imposing higher tariffs on China is due to expire on Tuesday and it is unclear if it will be extended.

After the most recent round of China-U.S. trade talks, held late last month in Stockholm, Chinese and U.S. officials said they expected the deadline to be extended for another 90 days. The U.S. side said the decision was up to President Donald Trump. So far there has been no formal announcement about whether he will endorse an extension or push ahead with the higher tariffs.

The uncertainty has left businesses in limbo and a decision to raise the import duties could jolt world markets.

SILENCE FROM WASHINGTON AND BEIJING

Trump has repeatedly shifted deadlines and tariff rates, and neither side has indicated what it plans for Tuesday. Extending the Aug. 12 deadline for reaching a trade agreement with China would forestall earlier threats of tariffs of up to 245%.

Treasury Secretary Scott Bessent said Trump was deciding about another 90-day delay to allow time to work out details of an agreement setting tariffs on most products at 50%, including extra import duties related to illicit trade in the powerful opiate fentanyl.

Higher tariffs are aimed at offsetting the huge, chronic U.S. trade deficit with China, which hit a 21-year low in July as the threat of tariffs bit into Chinese exports.

It’s not unusual for the U.S. to give hints on where talks stand, but it’s rare for China to make announcements until major decisions are set. So far, Beijing’s refrained from commenting ahead of Tuesday’s deadline.

In an interview with Fox News taped on Thursday but aired on Sunday, U.S. Vice President JD Vance said Trump was considering additional tariffs on Beijing because of China’s purchases of Russian oil. But he said Trump “hasn’t made any firm decisions.”

CHINA RESISTED CUTTING AN EARLY BARGAIN

Prohibitively high tariffs on Chinese exports to the United States would put huge pressure on Beijing at a time when the Chinese economy, the world’s second largest, is still recovering from a prolonged downturn in its property market. Lingering effects of the COVID-19 pandemic have left millions of people reliant on “gig work,” crimping the job market. Higher import taxes on small parcels from China have also hurt smaller factories and layoffs have accelerated.

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But the U.S. relies heavily on imports from China for all sorts of products, from household goods and clothing to wind turbines, basic computer chips, electric vehicle batteries and the rare earths needed to make them. That gives Beijing some powerful leverage in the negotiations with Washington.

Even with higher tariffs, China remains competitive for many products. And its leaders are aware that the U.S. economy is only just beginning to feel the effects of higher prices from Trump’s broad tariff hikes.

For now, imports from China are subject to a 10% baseline tariff and a 20% extra tariff related to the fentanyl issue. Some products are taxed at higher rates. U.S. exports to China are subject to tariffs of around 30%. Before the two sides called a truce, Trump had threatened to impose 245% import duties on Chinese goods. China retaliated by saying it would hike its tariff on U.S. products to 125%.

MUCH IS AT STAKE

A trade war between the world’s two largest economies has ramifications across the global economy, affecting industrial supply chains, demand for commodities like copper and oil and geopolitical issues such as the war in Ukraine.

After a phone call with Chinese leader Xi Jinping in June, Trump said he hoped to meet with Xi later this year. That’s an incentive for striking a deal with Beijing.

If the two sides fail to keep their truce, trade tensions could escalate and tariffs might rise to even higher levels, inflicting still more pain on both economies and rattling world markets. Businesses would refrain from making investment commitments and hiring, while inflation would surge higher.

Companies are in an “extended wait-and-see mode,” Oxford Economics said in a recent report.

The Associated Press

NEW YORK (AP) — Nvidia and AMD agreed to share 15% of their revenues from chip sales to China with the U.S. government, President Donald Trump confirmed at a press conference Monday.

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The Trump administration halted the sale of advanced computer chips to China in April over national security concerns, but Nvidia and AMD revealed in July that Washington would allow them to resume sales of the H20 and MI308 chips, which are used in artificial intelligence development.

The president said he originally wanted 20% of sales in exchange for Nvidia obtaining export licenses to sell the “obsolete” H20 chip to China, but credited Nvidia CEO Jensen Huang for negotiating him down to 15%.

“So we negotiated a little deal. So he’s selling a essentially old chip,” Trump said.

Nvidia did not comment about the specific details of the agreement or its quid pro quo nature, but said they would adhere to the export rules laid out by the administration.

“We follow rules the U.S. government sets for our participation in worldwide markets. While we haven’t shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide,” Nvidia wrote in a statement to the AP. “America cannot repeat 5G and lose telecommunication leadership. America’s AI tech stack can be the world’s standard if we race.”

AMD did not immediately reply to a request for comment.

The top Democrat on a House panel focusing on competition with China raised concerns over the reported agreement, calling it “a dangerous misuse of export controls that undermines our national security.”

Rep. Raja Krishnamoorthi, the ranking member of the House Select Committee on China, said he would seek answers about the legal basis for this arrangement and demand full transparency from the administration.

“Our export control regime must be based on genuine security considerations, not creative taxation schemes disguised as national security policy,” he said. “Chip export controls aren’t bargaining chips, and they’re not casino chips either. We shouldn’t be gambling with our national security to raise revenue.”

Derek Scissors, senior fellow and China expert at the conservative American Enterprise Institute, questioned the constitutionality of the deal and also warned against risking national security for revenue.

“There’s no precedent for this, probably because export taxes are unconstitutional, ” said Derek Scissors, senior fellow and China expert at the conservative American Enterprise Institute. “They call it a fee, but 15% of sales revenue is about a standard a tax as it comes. For this reason, I don’t think the ‘arrangement’ is at all durable. ‘’

“If it were to last, it has two possible implications. First, there’s a possible export tax that high-profile companies and goods must consider. Or the tax only applies in exceptional situations, such as changing export controls. Then we’d risk national security for the sake of tax revenue, which is effectively the same as cutting the defense budget,” Scissors said.

Back in July, Nvidia argued that tight export controls around their chip sales would cost the company an extra $5.5 billion. They’ve argued that such limits hinder U.S. competition in a sector in one of the world’s largest markets for technology, and have also warned that U.S. export controls could end up pushing other countries toward China’s AI technology.

Commerce Secretary Howard Lutnick told CNBC in July that the renewed sale of Nvidia’s chips in China was linked to a trade agreement made between the two countries on rare earth magnets.

Restrictions on sales of advanced chips to China have been central to the AI race between the world’s two largest economic powers, but such controls are also controversial. Proponents argue that these restrictions are necessary to slow China down enough to allow U.S. companies to keep their lead. Meanwhile, opponents say the export controls have loopholes — and could still spur innovation. The emergence of China’s DeepSeek AI chatbot in January particularly renewed concerns over how China might use advanced chips to help develop its own AI capabilities.

Associated Press writers Josh Boak and Shawn Chen contributed to the reporting.

WASHINGTON (AP) — A Food and Drug Administration official is getting his job back as the agency’s top vaccine regulator, less than two weeks after he was pressured to step down at the urging of biotech executives, patient groups and conservative allies of President Donald Trump.

Dr. Vinay Prasad is resuming leadership of the FDA center that regulates vaccines and biotech therapies, a spokesperson for the Department of Health and Human Services said in a statement Monday.

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Prasad left the agency late last month after drawing ire of right-wing activists, including Laura Loomer, because of his past statements criticizing Trump.

A longtime a critic of FDA’s standards for approving medicines, Prasad briefly ordered the maker of a gene therapy for Duchenne’s muscular dystrophy to halt shipments after two patient deaths. But that action triggered pushback from the families of boys with the fatal condition and libertarian supporters of increased access to experimental medicines.

Prasad’s decision to pause the therapy was criticized by The Wall Street Journal editorial board, former Republican Sen. Rick Santorum and others. The FDA swiftly reversed its decision suspending the therapy’s use.

Loomer posted online that Prasad was “a progressive leftist saboteur,” noting his history of praising liberal independent Sen. Bernie Sanders.

But Prasad has had the backing of FDA Commissioner Marty Makary and health secretary Robert F. Kennedy Jr., who have both called for scrutinizing the use of COVID-19 vaccines. Under Prasad, the FDA restricted the approval of two new COVID-19 shots from vaccine makers Novavax and Moderna and set stricter testing requirements for future approvals.

The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Department of Science Education and the Robert Wood Johnson Foundation. The AP is solely responsible for all content.

By BRUCE SCHREINER, Associated Press

LOUISVILLE, Ky. (AP) — Ford Motor Co. will invest nearly $2 billion retooling a Kentucky factory to produce electric vehicles that it says will be more affordable, more profitable to build, and will outcompete rival models.

The automaker’s top executive unveiled the new EV strategy Monday at Ford’s Louisville Assembly Plant which, after producing gas-powered vehicles for 70 years, will be converted to manufacture electric vehicles.

“We took a radical approach to solve a very hard challenge: Create affordable vehicles that are breakthrough in every way that matters — design, technology, performance, space and cost of ownership — and do it with American workers,” Ford CEO Jim Farley said in a release.

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The Big Detroit automakers have continued to transition from internal combustion engines to EV technology even as President Donald Trump’s administration unwinds incentives for automakers to go electric. Trump’s massive tax and spending law targets EV incentives, including the imminent removal of a credit that saves buyers up to $7,500 on a new electric car.

Yet Farley and other top executives in the auto industry say that electric vehicles are the future and there is no going back.

The first EV to roll off the revamped Louisville assembly line will be a midsize, four-door electric pickup truck in 2027 for domestic and international markets, the company said Monday.

The new electric trucks will be powered by lower-cost batteries made at a Ford factory in Michigan. The Detroit automaker previously announced a $3 billion investment to build the battery factory.

The automaker sees this as a “Model T moment” for its EV business — a reference to the mass-produced vehicle that launched the venerable automaker more than a century ago. But Ford says it’s also a nod to the future and the vastly different way Ford says it will build electric vehicles.

The company said it will use a universal platform and production system for its EVs, essentially the underpinning of a vehicle that can be applied across a wide range of models, from sedans to SUV, and include both electric internal combustion vehicles.

The Louisville factory — one of two Ford assembly plants in Kentucky’s largest city — will be revamped to cut production costs and make assembly time faster as it’s prepared to churn out electric vehicles.

The result will be “an affordable electric vehicle that we expect to be profitable,” Farley said in an interview with The Associated Press ahead of the announcement. “This is an example of us rejuvenating our U.S. plants with the most modern manufacturing techniques.”

The new platform enables a lineup of affordable vehicles to be produced at scale, Ford said. It will reduce parts by 20% versus a typical vehicle, with 25% fewer fasteners, 40% fewer workstations dock-to-dock in the plant and a 15% faster assembly time, Ford said. The traditional assembly line will be transformed into an “assembly tree” at the Louisville plant, it said. Instead of one long conveyor, three sub-assembly lines will operate simultaneously and then join together, it said.

“Nobody wants to see another good college try by a Detroit automaker to make an affordable vehicle that ends up with idled plants, layoffs and uncertainty,” Farley said in the release. “So, this has to be a good business. From Day 1, we knew there was no incremental path to success. … We reinvented the moving assembly line.”

Other specifications for the midsize electric truck – including its reveal date, starting price, EPA-estimated battery range, battery sizes and charge times — will be announced later, the company said. Ford revealed in its release that the truck will have a targeted starting price of about $30,000.

Ford said its investment in the Louisville plant will secure 2,200 hourly jobs.

Kentucky Gov. Andy Beshear said Monday that the automaker’s plans for the Louisville plant will strengthen a more than century-old partnership between Ford and the Bluegrass State.

“This announcement not only represents one of the largest investments on record in our state, it also boosts Kentucky’s position at the center of EV-related innovation and solidifies Louisville Assembly Plant as an important part of Ford’s future,” Beshear said.

Ford said its combined investment of about $5 billion at the Kentucky assembly plant and Michigan battery plant is expected to create or secure nearly 4,000 direct jobs between the two plants while strengthening the domestic supply chain with dozens of new U.S.-based suppliers.

Ford previously forecast weaker earnings growth for this year and further losses in its electric vehicles business as it works to control costs. Model e, Ford’s electric vehicle business, posted a full-year loss of $5.08 billion for 2024 as revenue fell 35% to $3.9 billion.

Ford’s new EV strategy comes as Chinese automakers are quickly expanding across the globe, offering relatively affordable electric vehicles.

“We’re not in a race to build the most electric cars,” Farley told the AP when asked about competition from China. “We’re in a race to have a sustainable electric business that’s profitable, that customers love.

“And this new vehicle built in Louisville, Kentucky, is going to be a much better solution to anything that anyone can buy from China,” he added.