On Sunday, June 29, US President Trump granted an exclusive interview with Fox News regarding the latest developments in US-China negotiations. The current temporary suspension of high tariffs on China is set to end on August 12, sparking speculation on whether Trump will extend the suspension, maintain the existing tariff levels, or reinstate punitive high tariffs, drawing widespread attention.
Trump emphasized that under the trade framework agreement reached with China, “China will face significant tariffs, but the significant trade deficit the US holds with China is well known to them. President Xi and I have a good relationship, and we must take measures to address this massive trade deficit issue. The Biden administration allowed the US trade deficit with China to skyrocket to one trillion dollars.”
“Just think about it, the US has a trade deficit of up to one trillion dollars with China, yet Biden let China take advantage of the US. We will not let this situation persist. We are nearing a rare earth agreement with China, and at the same time, the US holds all aircraft parts supplies. Without US parts, China cannot fly airplanes.”
Trump stated that the US still holds significant cards in the global supply chain and has certain defense measures in place. He expressed disappointment that the US had to rely on China for rare earth materials known as “magnets,” which the US should have been producing domestically. He said, “They (China) are currently manufacturing these magnets for us, and everything is going smoothly. We have an agreement with China.”
According to Trump, the recent agreement reached is beneficial for all parties. The previously imposed tariffs on China had reached as high as 145%, causing almost a complete halt in Chinese economic activities. Currently, Trump believes that the relationship between the two countries is cordial, and China is still paying substantial tariffs.
“I believe this is a good deal that benefits everyone. We reached an agreement with China when tariffs were as high as 145%. Let me tell you, at that time, everything in China came to a standstill. I witnessed everything come to a halt. Now, we have done China a favor, and we get along well. I think having a good relationship with China is a very positive thing, and they are indeed paying substantial tariffs,” Trump stated.
However, host Maria Bartiromo expressed the opinion that Trump seemed to make many concessions to China without fully utilizing his negotiating leverage or chips. In response, Trump said, “If I really need to use them, I will use them. But if it’s not necessary, maintaining the status quo is also good.”
Regarding the recent arrests by the Justice Department of several Chinese citizens attempting to bring in harmful pathogens, when asked if these events would influence the overall US policy towards China and tariff strategy, Trump replied, “I am not sure about the true source of the incident. I mean, was it the country’s doing, or did these three lunatics happen to bring something to the US? You can never be certain about these things.”
The host asked Trump how he intends to negotiate with such obvious bad actors as China, given that there are Chinese signatories endorsing Mao Zedong’s values, continuous cyber-attacks by the Chinese Communist Party, intellectual property theft, and issues involving fentanyl and the COVID-19 pandemic.
“Do you not think we will respond in kind?” Trump said. “So we also act in that way, that’s how the world operates. The world is very realistic and nasty.”
Trump stated that he plans to continue trade agreements with China, “We have earned a lot of money through this trade agreement. As long as the agreement is valid, I will engage in trade agreements. We have made a lot of money from this agreement.”
The host inquired whether Trump believes that now that a new rare earth agreement has been reached between the US and China, he trusts that the Chinese Communist Party will no longer oppress foreign enterprises, force them to surrender technology, as they have done in the past.
“These companies should not have put themselves in that position in the first place. They really should not have. But what I’m saying is, China needs those companies more now than two years ago. Two years ago, China could do this, but today, they cannot because they need these companies now,” Trump said.
“They need Apple. They need these companies. Apple is investing six to seven hundred billion dollars in the US. They never planned to do that before. Think about it, seven hundred billion dollars. Many companies that were in China are now moving back to the US.”
“So, China will now treat these companies much better because they need them. During Biden’s term, they didn’t need them as they were taking advantage of the US everywhere. But during my term, they need these companies.”
The host asked Trump about the impending end of the tariff suspension period on July 9, and what actions he plans to take – whether to extend the suspension, maintain the current situation, or reinstate high tariffs.
Trump stated that dealing with trade issues is actually “simple.” His team is actively negotiating with multiple countries and has almost reached agreements with India, China, and the UK. Despite having agreements in place, he leans towards directly sending out a “fair letter” that informs the other party they can trade in the US but must pay a certain percentage of tariffs, whether it be 25%, 20%, 40%, or 50%, as he believes this approach is more efficient.
“I feel I may not need to extend the suspension period, as I can already extend it, and it’s not a big deal. Just like TikTok, I am extending that deadline, but it’s not a big deal.”
Trump expressed his intention to send a letter to approximately 200 countries globally before July 9. The letter will indicate that the US is pleased to collaborate with other nations, but if they wish to trade in the US market, they must comply with regulations and pay around a 25% tariff. He noted that no matter how large the team is, they cannot negotiate individually with every country.
Trump likened the US to a department store, stating that foreign countries must pay if they want to “shop.” He emphasized that such trade agreements are straightforward because the US holds advantages that other countries do not.
“We will set a high figure first and will soon start sending out letters,” Trump said. “Because we already have all the data. Next, we will send them the letters and inform them, ‘Congratulations, you can trade in the US market, but you need to pay a 25%, 35%, 50%, or 10% tariff.'”
“If it weren’t for me turning the situation around, goods being exported from China would have been forced to return due to tariffs as high as 145%, causing significant trouble for China with no one willing to buy Chinese goods from Walmart. Later, I helped lower the tariffs for China.”