The US Treasury Secretary said President Trump may end his threat of 100% tariffs on China as negotiations continue.
U.S. Treasury Secretary Scott Bessent said plans for U.S. President Donald Trump to meet with Chinese President Xi Jinping in South Korea in late October remain intact despite a flare-up in trade tensions between the two countries.
On Monday, Bessent said in an interview with Fox Business Network that the United States and China have “significantly de-escalated” following a series of retaliatory trade moves that have strained relations and threatened to spark a new trade war between the United States and China.
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The comments came after President Trump, enraged by China’s Oct. 9 decision to expand export controls on key rare earth minerals, announced additional 100% tariffs on Chinese goods scheduled to take effect Nov. 1.
But Bessent said there has since been “substantive communication” between the two sides, and additional staff-level meetings are scheduled for this week.
“Despite last week’s announcement, relations are good. Communication lines have been reopened, so let’s see what happens,” Bessent said, adding that if the two sides resolve their differences through negotiations, “there would be no need to impose 100% tariffs.”
He added that he hopes the meeting between President Trump and Mr. Xi, scheduled for the Asia-Pacific Economic Cooperation (APEC) forum in South Korea in late October, will take place. “He (Trump) is scheduled to meet with Party Chairman Xi (Communist Party) in South Korea,” Bessent said. “I think the meeting will continue.”
Bessent stressed that Trump and Xi have a “very good relationship” and suggested that Beijing’s latest policy on rare earths may have been the brainchild of lower-level officials rather than Xi himself.
The comment echoes a seemingly conciliatory message from President Trump, who a day earlier asserted that “everything will be fine” in U.S.-China relations.
“Don’t worry about China, everything will be fine!” Trump wrote in a post on Truth Social. “Respected President Xi has reached his worst moment. He doesn’t want a crisis for his country, and neither do I. America wants to help China, not hurt it!!!”
The soft tone soothed jittery Wall Street after President Trump’s tariff announcement on Friday sparked a strong sell-off, sparking a strong rebound in U.S. stocks at the open in New York on Monday.
“He pointed the bazooka at me.”
Despite the apparent closeness, Bessent denounced China’s new export restrictions as provocative and said the U.S. pushed back aggressively.
“They are pointing a bazooka at the supply chain and industrial base of the entire free world,” Bessent said. “And, you know, we’re not going to have it. China is a command-and-control economy. They’re not going to command (or) control us.”
He added that the United States is in contact with allies and looks forward to support from allies in Europe, India and Asia.
China is defending new export regulations that require foreign companies to obtain Chinese government approval to export products containing Chinese rare earth elements and to disclose their use.
China’s Ministry of Commerce said the tightened restrictions were introduced in response to a series of U.S. measures since bilateral trade talks in Madrid, Spain, last month, including the U.S. decision to blacklist Chinese companies and impose port fees on Chinese-linked ships.
Beijing has accused the US of “provocative and harmful” actions and called President Trump’s tariff threats a “classic example of double standards”.
China has a near monopoly on rare earth minerals, which are essential for making technologies such as electric cars, smartphones, semiconductors and weapons.
The United States is a major consumer of Chinese rare earths, which are critical to the U.S. defense industry.
