Trump Confident U.S.-China Trade Talks Will Lead To Tariff Cuts

US President Donald Trump has indicated that the steep tariffs imposed on Chinese goods could soon be reduced, as both countries prepare for high-level trade negotiations in Switzerland this weekend.

Speaking at the White House during the announcement of a new trade agreement with the UK, Trump said the current 145% tariffs on Chinese imports were likely to decrease.

Referring to the import taxes introduced since his return to office, he commented that the rate had reached its peak and was expected to fall.

Trade officials from the US and China, including US Treasury Secretary Scott Bessent and China’s Vice Premier and economic policymaker He Lifeng, will meet in neutral Switzerland. Jamieson Greer, the US’s chief trade negotiator, is also expected to take part.

Trump expressed optimism about the talks, describing them as “friendly” and likely to be handled in an “elegant way.” He added that he believed China had a strong interest in making a deal and that the discussions could be substantive.

Chinese Vice Foreign Minister Hua Chunying also conveyed confidence ahead of the meeting, stating that Beijing had full capability to handle trade matters with the US.

Political risk expert Dan Wang from Eurasia Group shared that both governments were under increasing economic pressure and that recent actions pointed to the possibility of a deal focused on easing the situation.

However, experts have warned that the outcome of the talks may be limited. Former US trade negotiator Stephen Olson noted that any tariff reductions from the discussions were likely to be small and that broader trade disagreements would persist for the foreseeable future.

He added that active involvement from both Trump and Chinese President Xi Jinping would be necessary for a final resolution.

Eswar Prasad, former head of the IMF’s China division, commented that even if the latest tariffs were withdrawn, the two nations would still face high trade barriers and additional restrictions.

Trump also said he might speak with President Xi after the talks. He pointed out that China continues to enjoy a large trade surplus with the US and reiterated his desire to see more openness in China’s economy.

Meanwhile, official data released on Friday showed that China’s exports to the US dropped by over 20% in April compared to the previous year. Still, China’s total exports rose by 8.1%, surpassing expectations.

The timing of the talks coincides with the recent announcement of a trade deal between the US and the UK-the first such agreement since Trump reinstated heavy import taxes in April. Under the new deal, the US will lower tariffs on a selection of British-made cars and allow limited duty-free access for UK steel and aluminum.

Other key UK sectors will also receive relief from Trump’s latest tariffs, which had been announced following his return to the White House in January. The agreement comes amid a 90-day pause on new tariffs for most countries, aimed at giving foreign governments a chance to negotiate. Notably, the pause did not apply to China.

Nations worldwide are now scrambling to reach similar agreements with the US before the new tariffs take full effect next month.

Back in the US, businesses are closely watching the outcome of the weekend talks. One such company, Wild Rye-a women’s outdoor clothing brand based in Idaho-has been hit hard by the increased tariffs. The company manufactures its goods in China and has seen its shipping costs rise sharply.

Cassie Abel, the company’s CEO, shared that a $700,000 order was now facing £1.2 million in duties, up from £200,000 previously. She added that she is now considering selling parts of the business to raise cash.

Trump, who has long pushed for fairer trade terms and blames China for taking advantage of US markets, said he hopes China will open its economy further. He stressed that the upcoming meeting could be a turning point and added that China had more to gain from a deal than the US.

Reference: Reuters, BBC

Source: Maritime Shipping News