U.S. Representative Bessent urges nations not to be alarmed if trade accords aren't sealed prior to tariff cutoff, maintains America holds the upper hand regarding China.
The US-China trade relationship remains complex and ongoing, with periodic agreements and tariff adjustments, as stated by Treasury Secretary Scott Bessent in August 2022. Three rounds of talks between Bessent and US Trade Representative Jamieson Greer and their Chinese counterparts have been held in an effort to open up Beijing's economy to US goods.
Following the Geneva trade deal in May 2025, the US and China signed a framework agreement in June, reaffirming commitments. However, specific details remain limited, and the overall tariff rates on Chinese imports to the US remain high, around 55%. This high tariff rate is a combination of multiple tariff components imposed since 2018 and continuing through the current Trump administration since January 2025.
A temporary 90-day tariff suspension covering some reciprocal tariffs was in effect starting August 11, 2025, but the baseline tariffs largely remain in place while negotiations continue. The tariff rate is significantly lower than the 145% rate Trump threatened at the peak of their trade war in the spring.
As we approach August 12, a 34% reciprocal tariff is set to take effect against Beijing. Commerce Secretary Howard Lutnick has stated that the tariff deadline cannot be extended any more, and duty rates are set to jump from the current 10% to as high as 50% if there's no deal by August 1.
Despite the tension, Trump has expressed optimism about the prospects of an agreement with China. Bessent, however, asserted that China will not receive a "special deal," despite being America's third-largest trading partner among individual nations. Bessent encourages market participants, corporate America, and even countries not to panic if there's no deal by August 1, as deals can still be made after that date.
Trump has affirmed that the August 1 deadline is firm and will not be extended. Trump stated that the US and China are "very close to a deal." Bessent made his remarks after returning from a meeting with Chinese representatives in Stockholm. He also implored US trading partners not to panic if they don't agree to economic deals before President Trump's tariff deadline on August 1.
The US has not yet signed off on a permanent agreement with China due to having "a lot more leverage." Recent trade deals with the European Union and Japan have increased the US's leverage in negotiations with China, according to Bessent. Trump is willing to listen to people between now and August 1, but whether they can make him happy is another question. Customs will start collecting the money if the tariffs are set to go into place on August 1.
In conclusion, the US-China trade relationship remains tense as the August 1 tariff deadline approaches. Despite some temporary relief periods, high tariffs and complex reciprocal trade measures persist, reflecting ongoing trade diplomacy and management rather than a fully normalized trade relationship.
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