Bessent: Trump Will Make Final Call On China Tariff Truce (Full Q&A)

US-China Trade Relations - The US expressed concerns about China's global overcapacity and purchases of sanctioned Iranian oil, which account for approximately 90% of Iran's oil sales [2] - The US also expressed concerns about China selling approximately $15 billion of dual-use technologies to Russia [2] - The US reiterated its trade policy goals of reducing US deficits, increasing manufacturing, and reshoring the economy [3] - The US aims to "derisk" rather than "decouple" from China, focusing on strategic industries like rare earths, semiconductors, and medicines [5] - Discussions included accelerating the flow of rare earth magnets from China to US companies [4] - China had previously blocked all of their rare earth magnets, but now the US is receiving them [17] Trade Imbalances and Tariffs - China's economy is described as the most unbalanced in modern times, with 30% of global manufacturing and a 2% current account surplus of global GDP [13] - The US is tracking an annual trade deficit with China, but it is expected to be at least $50 billion smaller this year [15] - Section 232 investigations on pharmaceuticals and semiconductors will be applied globally, without targeting any specific country [16] - Potential tariffs on countries buying sanctioned Russian oil could range from 0% to 500%, with the US Senate considering a bill to grant the president discretion to apply secondary tariffs [37] Potential Tariff Pause and Future Discussions - A potential pause on tariff increases is under discussion, with a possible duration of 90 days [9][42] - If the pause is not extended, tariffs could revert to a 34% level, potentially reaching 80-85% depending on the product [18][20] - Further technical discussions are ongoing between the US and Chinese teams [10] - A phone call between President Xi and President Trump occurred in June, during which President Xi invited President Trump to Beijing [22][23] US Economic Outlook - The US economy is performing well, with the biggest downturn in inflation in four years observed in May [33][34] - The US is expected to receive a minimum of $300 billion in tariff income this year, representing 1% of GDP [41]