Treasury Secretary Scott Bessent recently revealed that he met with his Chinese counterpart during a week filled with meetings at the IMF World Bank in Washington, D.C. This interaction comes amid ongoing tensions between the United States and China, which have been locked in a trade war.
Despite Bessent’s engagement, Chinese officials have denied that any trade discussions took place. President Donald Trump, however, has insisted that there were indeed meetings, suggesting a more complex situation than what Beijing is acknowledging.
In an interview on ABC’s “This Week,” Bessent explained that their conversation mainly revolved around traditional topics such as financial stability and global economic indicators, rather than direct trade issues. This is significant given the backdrop of rising tariffs that the U.S. has imposed on China, which now stand at an unprecedented 145%. In retaliation, China has increased tariffs on American goods to 125%.
Trump recently hinted that the situation might be improving, saying that tariffs on China could be reduced substantially, although he did not specify any timeline or details. He has also mentioned having multiple conversations with Chinese President Xi Jinping, but it remains unclear if these discussions occurred after the tariffs were escalated.
Bessent emphasized that he is not aware of any formal negotiations but noted that there is mutual respect between the two leaders. He believes that the current high tariff levels are not sustainable for China’s economy, which relies heavily on exporting cheap goods to the U.S. He argued that if trade were to suddenly halt, it would significantly impact China’s economic stability, prompting them to negotiate.
When pressed about the timeline for a potential trade agreement, Bessent indicated that while a comprehensive deal could take two to three years, the immediate focus should be on de-escalating tensions. He mentioned the importance of reaching an "agreement in principle" with China and other affected trading partners. This would ideally lead to a reduction in the so-called "Liberation Tariffs" to a base rate of 10% during a 90-day pause.
Bessent concluded by stating that while reaching a trade deal can be a lengthy process, maintaining good behavior and adhering to the terms of any agreement can help prevent tariffs from rising back to their maximum levels.