President Trump laid down clear terms for China on trade negotiations, signaling that America will set the conditions if China refuses to agree to a fair deal.

At a Glance

• Trump announced tariffs on Chinese goods will drop “substantially, but not to zero” amid ongoing negotiations
• The administration imposed up to 245% tariffs on Chinese imports, while China retaliated with 125% tariffs on US goods
• Trump warned China must make a deal or the US will “set the terms” as America faces nearly $2 trillion in trade losses
• Treasury Secretary Scott Bessent described the high tariffs as “unsustainable” and expects “de-escalation”
• The S&P 500 index rose 2.5% following comments about potential progress in trade talks

Trump Takes Firm Stance on China Trade Negotiations

President Donald Trump made it clear that while he’s open to working with China on reducing tariffs, he’s prepared to dictate terms if necessary. During a White House news conference, Trump emphasized that China and other nations must negotiate fair trade agreements with the United States. The administration is taking a strong position after implementing tariffs that have escalated to 245% on some Chinese goods, while China has responded with 125% tariffs on American products. These trade tensions have created significant market volatility and impacted interest rates on US debt.

The President highlighted the economic stakes involved, stating firmly: “We’re losing almost $2 trillion on trade, and those days are gone. We’re not going to do that again.” This statement underscores the administration’s determination to address long-standing trade imbalances that have disadvantaged American businesses and workers. While Trump has paused global tariffs for 90 days for countries negotiating with the US, China remains excluded from this pause as discussions continue.

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— Brian (@Brian1247356379) April 7, 2025

Progress and Market Response

There are signs that both sides recognize the current situation cannot continue indefinitely. Treasury Secretary Scott Bessent acknowledged the challenges in the negotiations, saying: “I do say China is going to be a slog in terms of the negotiations. Neither side thinks the status quo is sustainable.” His comments about the unsustainability of high tariffs and expectations for “de-escalation” in the trade war triggered a positive market response, with the S&P 500 index rising 2.5% following his remarks. The President noted this market improvement but did not explicitly endorse Bessent’s assessment.

“Donald Trump said during a White House news conference that high tariffs on goods from China will “come down substantially, but it won’t be zero”, said Donald Trump.

White House Press Secretary Karoline Leavitt has reported positive progress in the trade negotiations with China. The administration has received 18 trade deal proposals from other countries seeking to avoid punitive tariffs, demonstrating the global impact of Trump’s trade policies. These developments suggest that the President’s strategy of applying pressure through tariffs may be creating incentives for more favorable trade terms for the United States.

China’s Response and International Implications

China has responded firmly to the US position, warning other nations against making trade deals that could harm Chinese interests. The Chinese Commerce Ministry stated: “China firmly opposes any party reaching a deal at the expense of China’s interests.” Reports indicate that China is pressuring third countries to enforce restrictions on US sales involving Chinese minerals, escalating the economic conflict beyond direct bilateral trade. Chinese state media, including the China Daily, has criticized Trump’s tariffs as destabilizing for global trade.

“Ultimately, they have to make a deal because otherwise, they’re not going to be able to deal in the United States. So we want them involved but they have to, and other countries have to, make a deal. And if they don’t make a deal, we’ll set the deal.”, added President Trump.

Despite the tough stance, President Trump has expressed willingness to work constructively with Chinese President Xi Jinping. “They are going to do very well, and I think they’re going to be happy, and I think we’re going to live together very happily and, ideally, work together,” Trump stated. This suggests that while the administration is prepared to maintain pressure through tariffs, the preferred outcome is a mutually beneficial agreement that addresses America’s trade concerns while maintaining a working relationship with China.