President Donald Trump on Friday set negotiating terms for his administration’s first discussions with China, which are set to take place in Geneva this weekend.
In a series of posts on Truth Social, Trump appeared to lay out his demands — and concessions — for the meeting between US Treasury Secretary Scott Bessent, US Trade Representative Jamieson Greer and their Chinese counterparts. Trump said China must import more US goods, and in return, he believes the United States should lower its 145% tariff on most Chinese goods to 80%.
“CHINA SHOULD OPEN UP ITS MARKET TO USA — WOULD BE SO GOOD FOR THEM!!! CLOSED MARKETS DON’T WORK ANYMORE!!!,” Trump posted.
“80% Tariff on China seems right! Up to Scott B,” Trump said in a separate post.
The concession would be a dramatic break from the present reality, which has sent shipments from China into the United States plunging by 60%, according to Ryan Petersen, CEO of Flexport, a logistics and freight forwarding broker.
Even if tariffs fall to 80%, it’s not clear that would be enough to convince US businesses to import Chinese goods. Economists have said 50% is the make-or-break threshold for the return of somewhat normal business between the two countries.
Meanwhile, the damage is already done. Price hikes are beginning, and Goldman Sachs analysts Thursday said a key measure of inflation would effectively double to 4% by year end because of the trade war. Even if tariffs went to 0% this weekend, the US would still have price hikes and shortages, at least temporarily, because so little has been coming into US ports.
China said Friday exports to the US fell 21% last month — before the effects of tariffs took hold.
Trump has said he considers that a good thing. In the Oval Office Friday, Trump said the reduction in shipments from China means the United States is no longer losing money — a frequent if highly inaccurate refrain from the president that mistakenly equates a trade imbalance with losses.
Trump and Bessent have both said the high tariff on China — and China’s 125% tariff on most US goods — is unsustainable and needs to be lowered.
However, Trump administration officials are trying to lower expectations about the potential outcomes of this weekend’s talks in Geneva, according to senior administration officials briefed on the plans. They are framing the talks as a good first step but won’t result in any kind of “deal,” or even a framework like the one with the United Kingdom that Trump announced in the Oval Office to much fanfare Thursday.
Despite Trump’s apparent overture, Director of the White House National Economic Council Kevin Hassett told CNN Friday that the tariff will not be lowered ahead of the negotiation.
“I think that everything will happen while the talks are happening, not before,” he said at the White House. “It will come out tomorrow what happens. It’s a negotiation.”
Hassett added that Bessent and Greer are going into negotiations “with an open mind,” but said that news about any changes in tariffs won’t come “until after the talks finish.”
Bessent said Tuesday on Fox News that the discussions are to begin the thawing process in a frozen trade relationship.
“My sense is that this will be about de-escalation, not about the big trade deal … but we’ve got to de-escalate before we can move forward,” he said. “You know, 145% [tariffs], 125%, is the equivalent of an embargo. We don’t want to decouple, what we want is fair trade.”
In the meantime, America’s aggressive trade war has sent the US economy into reverse. Last week’s report on gross domestic product, the broadest measure of the US economy, showed America’s first contraction since early 2022, as an otherwise-healthy economy was dragged down by companies stockpiling goods to get ahead of tariffs. And that was the first quarter — before the most aggressive trade policy had even taken effect.
Despite the increasingly dire warnings and economic turmoil, the United States and China remain far apart on an actual deal. Even with the talks set to kick off this weekend, Bessent said it could take two to three years for trade to normalize with China.
This story has been updated with additional developments and context.
Read the full article here