On Wednesday, U.S. Treasury Secretary Scott Bessent expressed his belief that the extremely high tariffs imposed between the U.S. and China must be lowered before any trade discussions can take place.
While speaking to reporters during the International Monetary Fund and World Bank’s annual meetings, Bessent emphasized that reducing tensions is essential for the two largest economies in the world to realign their trade relations.
When asked if this meant decreasing the U.S. tariffs of 145% on Chinese products and the 125% tariffs China has on U.S. goods, he replied, “I believe that is necessary because neither side considers these levels to be viable. As I mentioned yesterday, this situation resembles an embargo, and a breakdown in trade does not favor anyone.”
Furthermore, Bessent refrained from confirming a Wall Street Journal report that suggested the Trump administration was thinking about unilaterally cutting tariffs on Chinese imports—potentially by over 50%—as a means to alleviate the ongoing trade conflict.
“I would be surprised if such discussions are taking place,” Bessent remarked, adding that he did not anticipate any unilateral moves from Trump to reduce tariffs, but he could see reductions occurring in a reciprocal manner.
Bessent noted that the Trump administration is aiming to ensure tariff stability through negotiations with numerous countries and does not anticipate a lengthy process, as nations will wish to avoid the elevated reciprocal tariffs announced on April 2.
He also clarified his earlier comments regarding a two-to-three-year timeline for reaching a U.S.-China agreement, stating that this applied to the overall process of rebalancing rather than the negotiations, which should progress more swiftly.
He mentioned that the third quarter of this year is a “reasonable estimate” for gaining clarity on the final tariff levels established by Trump and expressed that he was not worried about the IMF’s recent reduction in the forecasted U.S. growth rate by nearly a full percentage point to 1.8% for 2025, attributing this adjustment largely to Trump’s tariffs, retaliatory measures, and the resulting uncertainties.
Bessent aims to boost U.S. growth and contended that Trump’s economic strategies would elevate growth to 3% through increased energy production.
“I am not concerned about the IMF’s projections. I believe that by the third quarter, we should have a clear picture regarding tariffs,” Bessent stated. “We will have the tax legislation finalized, and while deregulation has always been the slowest aspect, it should begin to show effects in the third and fourth quarters.”