U.S. Treasury Secretary Scott Bessent speaks about a minerals agreement with Ukraine as Vice President JD Vance, left, listens in the Oval Office at the White House on April 17, 2025 in Washington, D.C. (Win McNamee/Getty Images)
| Published April 23, 2025
In a recent address, U.S. Treasury Secretary Scott Bessent indicated that the ongoing tariff standoff between the United States and China is unsustainable and anticipates a “de-escalation” in the trade war between the two economic giants. Speaking privately to JPMorgan Chase executives, Bessent acknowledged that formal negotiations have yet to commence, despite the high tariffs currently in place—145% on Chinese imports and 125% on U.S. goods.
Bessent emphasized that both nations recognize the untenable nature of the current trade dynamics, stating, “Neither side thinks the status quo is sustainable.” His remarks suggest a mutual understanding of the need to resolve the escalating economic tensions.
The financial markets responded positively to Bessent’s comments, with the S&P 500 index experiencing gains following reports of his speech. This optimism reflects investor hope for a resolution to the trade dispute that has contributed to market volatility.
While the Trump administration has engaged in trade discussions with several countries, including Japan, India, South Korea, the European Union, Canada, and Mexico, there has been no public indication of a rollback on the baseline 10% tariff. President Trump has maintained that he seeks reciprocal trade agreements and the removal of non-tariff barriers that hinder U.S. exports.
White House Press Secretary Karoline Leavitt reported that the administration has received 18 proposals from other nations for trade deals, signaling a global interest in negotiating with the U.S. However, China’s Commerce Ministry has cautioned against agreements that could compromise China’s interests, underscoring the complexity of the international trade landscape.
As the situation evolves, Secretary Bessent’s insights suggest a potential shift towards more constructive dialogue between the U.S. and China, aiming to alleviate the economic strain caused by the protracted trade conflict.
Here are the key implications of Treasury Secretary Scott Bessent’s recent remarks on the U.S.-China trade relationship:
📉 1. Possible De-escalation of Trade Tensions
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Bessent’s suggestion that the U.S. and China agree the current tariff war is “unsustainable” signals a potential turning point. Even though formal talks haven’t begun, the acknowledgment itself lays the groundwork for future negotiations.
💼 2. Positive Market Reaction
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Financial markets responded with optimism. The S&P 500 rose following Bessent’s comments, showing investor confidence that trade tensions may ease, reducing uncertainty for global businesses and supply chains.
🧾 3. Policy Shift Within the Trump Administration?
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While the administration has maintained high tariffs to push for reciprocal trade, Bessent’s tone indicates there may be internal pressure to reconsider or modify the strategy—especially given the economic risks of prolonged tariffs.
🌐 4. Pressure on China and Other Trade Partners
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Bessent’s openness to de-escalation comes as multiple countries submit proposals for new trade deals. This puts pressure on China to come to the table or risk being left behind in a reshaped global trade environment.
🇨🇳 5. Geopolitical Ramifications
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If the U.S. softens its approach toward China while finalizing deals with other key allies (Japan, EU, India), it may shift global economic alliances and influence how China responds to both trade and geopolitical issues.
🏛️ 6. Domestic Political Impact
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On the domestic front, this pivot could impact how voters and lawmakers perceive Trump’s economic agenda. Hardliners may view de-escalation as weakness, while moderates may see it as pragmatism in the face of economic realities.
🧭 Overall Takeaway
Treasury Secretary Scott Bessent’s remarks signal a potential softening in the hardline U.S.-China trade posture—one that could reshape the global economic outlook. While no formal negotiations are underway, the acknowledgment that current tariffs are “unsustainable” reflects a shared interest in de-escalation between the world’s two largest economies.
For markets and businesses, this is a hopeful sign that stability and predictability may return after years of trade turmoil. For the Trump administration, it represents a balancing act—maintaining a strong “America First” image while recognizing economic realities that demand diplomacy.
If followed by concrete action, Bessent’s comments could mark the beginning of a new chapter in U.S. trade policy—one that prioritizes tough negotiation without sacrificing long-term growth or global competitiveness.
SOURCES: NEWSMAX – Bessent Expects China Tariff Standoff to Deescalate
FRANCE 24 – US Treasury chief expects China tariff impasse to de-escalate
REUTERS – US Treasury Secretary says situation with China is unsustainable, source says
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