After two days of talks in Switzerland, both the United States and China reported “substantial progress” aimed at reducing the trade war, marking a “important first step” for his life as China’s vice-premier who resolved the differences.
Although both sides immediately announced specific measures on Sunday, he said the world’s two largest economies led by U.S. Treasury Secretary Scott Bessent and himself agreed to create a mechanism for further negotiations. Bessent said the U.S. will share details on Monday, and he promised to issue a joint statement.
“As we’ve come back in China, if the dishes are delicious, the timing doesn’t matter,” Lee Changgang, deputy minister of commerce, who was appointed as trade representative last month, told a reporter in Geneva. “Whenever it is released, it’s good news for the world.”
Bessent and Trade Representative Jamieson Greer will hold a press conference in Geneva at 9 a.m. Monday to discuss the talks, a U.S. official familiar with the preparations said.
Negotiators tried to convey a positive tone in separate comments to journalists over the weekend, praising the professionalism of the United States, and Greer, a U.S., suggested that the trade conflict between the two sides could be overestimated.
“It’s important to understand how quickly we can reach a deal, which reflects that the difference may not be as big as I think,” Greer said. “With that being said, there’s a lot of foundations in these two days.”
The yuan was strengthened as the Asian trading week began, with Chinese stocks posting trivial gains. On Monday, the benchmark CSI 300 for onshore stocks has risen 1.2% and is close to making up for its losses since U.S. President Donald Trump’s “Liberation Day” announced tariffs on April 2.
Bloomberg’s economics theory…
“When we wait to see what ‘substantial’ means, our analysis shows that even if the collection drops sharply from the current high levels of the sky, it still leaves a big hole in bilateral trade… In our lower tariff scenario, a decline in exports, a decline in exports, an impact of China’s GDP and a smaller impact on China, it is higher – even smaller – than the above 30% – even in the above ‘shoulder rate’ – even in the case of “high success rate” – even in the case of “success” – which is higher than in the case of “success” compared to “success”. Nearly 60% in the medium term.”
– Jennifer Welch, Chief Geoeconomics Analyst
“Although we can agree to any material attitude toward a mere two-day meeting, it’s clear that both sides want a downgrade situation,” wrote Strategy, who won the global market leader at Brown Brothers Harriman & Co., in a note.
The announcement comes after a few hours of meeting between Bessent, Greer and him, chaired by the Swiss ambassador to the United Nations, where his residence served as the venue. Bessent and they both said that both sides have made “significant progress”.
The Chinese team also includes Liao Min, a veteran of the negotiations for the first U.S.-China trade war.
Since Trump returned to office, breaking the deadlock in negotiations and establishing channels for negotiations has helped clear the path of the first leader call between the two countries. The U.S. president told reporters on Friday that he may talk to his Chinese counterparts after the meeting, depending on Bessent’s advice.
Tensions among the world’s largest economies reached new highs after Trump steadily raised tariffs in Beijing to 145%. These responsibilities should address China’s role in the fentanyl trade, a large-scale trade surplus with the United States and respond to Beijing’s retaliation measures taken after Trump’s opening. China’s response raised its tariffs on U.S. goods to 125%.
The tariff tits caused the deadlock, and neither side wanted to make the clumsy and couldn’t see the ramp. Ultimately, both sides acknowledged the need to reduce tensions and tariffs and announced open negotiations.
As the weekend, the U.S. hopes to ensure the removal of China’s restrictions on exports of rare earths used to make magnets a range of industries face damage, according to people familiar with the preparations. People say the U.S. aims to take tariffs as the first step below 60% tariffs and want to discuss ways that Beijing can reduce exports to make fentanyl ingredients.
Fear of empty shelves may have contributed to the urgency of the meeting, with Chinese exports to the United States falling 21% last month. Trump and his economic team received a request from retail executives, who explained in a meeting with senior officials that the result of continued high tariffs would be pandemic-level shortages and supply chain shocks.
Dexter Roberts, a senior researcher at the Atlantic Commission’s global hub for China, said that China is different from Trump because unlike Trump, they did not face the midterm elections in 2026. “Sitting in the United States is very harmful to Trump,” he said, adding that Chinese people can “suffer” for longer.
President Xi Jinping officials have tried to strengthen his country’s economy ahead of negotiations, free up a series of tax cuts and provide banks with more cash. But the data shows signs of future weakness. As the drag on the trade war intensifies and weak domestic demand prices have intensified, Chinese consumers have extended their deflation for a third month.
The American team entered the first day of the boss’s first negotiations. Trump released the truth before the meeting began: “China’s 80% tariff seems to be correct!” He added that it was “depending on” his Treasury Secretary without elaborating.
The United States and China have reached a trade agreement on their books that was signed at the end of Trump’s first semester in January 2020. At the time, the president called it “historic” and said it “corrected past mistakes.”
As part of the agreement, Beijing pledged to purchase more than $200 billion in U.S. goods and services and open its markets to the U.S. agricultural and financial services sector.
Martin Chorzempa, a senior fellow at the Peterson Institute for International Economics, said where the final tariff numbers will land, despite the encouraging remarks.
“At least the short-term resolution with China – the most difficult and complex bilateral relationship with the United States – will also be seen widely as a good sign of the potential for constructive negotiations with other countries,” he added.
– In Michael G.
More stories like this are available Bloomberg.com
Published on May 12, 2025
