Amid rising trade tensions between the United States and China, Treasury Secretary Scott Bessent has made it clear that meaningful trade talks can only start if tariffs are reduced mutually. He emphasized that the administration has no plans to unilaterally lower tariffs.
Current Tariffs: A Major Barrier to Negotiation
As the economic rivalry between Washington and Beijing persists, Treasury Secretary Scott Bessent firmly denied reports of a unilateral US plan to ease tariffs on Chinese imports. Instead, he insisted that both sides must take steps simultaneously to reduce tariffs in order to open the door to constructive negotiations.
Speaking at the Institute of International Finance (IIF) Global Outlook Forum, Bessent stated:
“Neither side believes these tariff levels are sustainable. What we’re looking at right now is essentially a trade embargo—this serves no one’s interest.”
Record-High Tariffs on Both Sides
Currently, the US imposes tariffs of up to 145% on Chinese goods, while China enforces a 125% tariff rate on American imports—figures that highlight the intensity of protectionist measures between the world’s two largest economies.
White House Denies Considering Unilateral Tariff Cuts
Bessent’s comments were in response to a Wall Street Journal report claiming that the Trump administration was weighing a significant reduction in tariffs on Chinese imports, potentially slashing them by over 50% in some categories.
Bessent dismissed the report, saying:
“I’d be surprised if such discussions were happening. There is no unilateral proposal from the president to de-escalate. That is not on the table.”
Mutual De-Escalation Remains a Possibility
Nonetheless, he acknowledged that both nations recognize the current tariff levels as unsustainable:
“If there’s a mutual move to reduce tariffs, then I would expect serious negotiations to follow between the United States and China.”
Talks Reserved for Heads of State
Bessent clarified that any forthcoming dialogue would be conducted directly between President Trump and President Xi Jinping, signaling that discussions will occur at the highest diplomatic level.
Broader Trade Ambitions Beyond China
The Treasury Secretary also touched on the broader scope of US trade policy, noting the administration’s intent to finalize deals with multiple countries:
“We’re very close to reaching a deal with India.”
His remarks echoed previous comments made by Vice President JD Vance, indicating a coordinated diplomatic push.
Policy Clarity Expected by Q3
According to Bessent, greater clarity on tariff policy and the new tax bill is expected by the third quarter of the year, which would then allow the administration to pivot toward its deregulatory agenda.
On the Rumors About Powell’s Dismissal
Bessent also addressed ongoing speculation about the possible dismissal of Federal Reserve Chair Jerome Powell, following a string of critical social media posts by President Trump.
Bessent downplayed the rumors:
“This is mostly a dragon the press created so it could slay it later.”
He added that the president’s dissatisfaction with Powell is nothing new:
“He’s expressed those views for years, so I wasn’t surprised by his remarks yesterday.”
Clarifying the President’s Stance
When asked about what seemed like a shift in tone from the president—who recently said he had “no intention” of firing Powell—Bessent rejected that interpretation, stating:
“The president never said he would fire Powell. He simply said he can’t wait for the end of his term.”
Notably, Powell’s term as Fed Chair ends in May 2026, and any premature dismissal could have serious consequences for financial markets.
