Trump administration eyes tariff reduction ahead of China negotiations

The Trump administration in the US is considering a “dramatic tariff reduction” in talks with China this weekend to ease tensions and alleviate the economic strain both sides have begun to feel.

According to sources close to the preparations for the talks, which will begin on Saturday in Geneva led by US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, the US side aims to reduce tariffs to below 60% as a first step it believes China might accept, according to Bloomberg.

If progress is made in the two-day talks, these reductions could be implemented next week.

The sources stated that the talks would be preliminary in nature and aimed at airing grievances rather than finding solutions to the long list of issues between the two sides.

The same sources added that the situation is uncertain and a reduction in tariffs in the near term is not guaranteed.

According to the information received, high on the US wish list is the removal of China’s export restrictions on rare earth elements used in magnet production, which have disrupted various industries. Progress has also been made on fentanyl.

The sources stated that separate talks could soon be held on reducing China’s exports of this opioid derivative, which has contributed to the increase in overdose deaths in recent years.

White House spokesman Kush Desai said in a statement, “The sole purpose of the administration in these negotiations is to advance President Trump’s America First economic agenda towards fair and reciprocal trade relations. All discussions about ‘target’ tariff rates are baseless speculation.”

The biggest challenge facing the Trump administration is the extremely high level of tariffs between the world’s two largest economies. US tariffs on many Chinese imports have reached 145%.

In statements made on Thursday, US officials, including President Donald Trump, clearly indicated their intention to lower the tariffs they rapidly increased in response to China’s retaliation against the tariffs announced on April 2.

Trump told reporters on Thursday while outlining a US-UK trade deal, “They can’t go up any higher, they’re at 145%, so we know they’re coming down. I think we’re going to have a good weekend with China.”

Commerce Secretary Howard Lutnick told CNBC, “De-escalating, bringing these rates down to where they could be, where they should be, I think that’s Scott Bessent’s goal. I think that’s the Chinese delegation’s goal. And that’s the good outcome the President is hoping for, a world where there’s de-escalation, where we’re back together, and we’re working on a big deal.”

US stock markets rose on Thursday as investors reacted positively to Trump’s comments on the trade talks with China.

Meanwhile, Chinese officials are cautious about their goals in the talks. On Thursday, Beijing reiterated its call for the Trump administration to lift the unilateral tariffs it imposed on China.

Ministry of Commerce spokesman He Yadong said the US “should approach the talks with sincerity and be ready to correct its mistakes.”