On Saturday (May 10), high-level trade negotiations between the United States and China were held in Geneva, Switzerland. Following an approximately 8-hour closed-door meeting, no statements were made by either side, and negotiations continued on Sunday. Two experts provided immediate commentary on the talks.
According to international media reports, the US delegation was led by US Treasury Secretary Benson, while the Chinese delegation was led by Chinese Vice Premier He Lifeng. It is currently unclear whether the 8-hour meeting on Saturday made any progress. The negotiations have been shrouded in secrecy, with both sides refraining from commenting to the press upon leaving.
US President Trump later stated on his social media platform Truth Social, “Today, had a very pleasant meeting with the Chinese side in Switzerland.” He indicated, “Both sides engaged in ‘comprehensive restart’ negotiations in a friendly and constructive manner. We hope to see China open its (markets) to American businesses, which benefits both China and the US.”
Trump finally mentioned that the negotiations had made “great progress.”
Meanwhile, as tariff negotiations unfolded in Geneva, Chinese state mouthpiece People’s Daily published an article on May 10 preemptively stating that hoping to solve problems in one or two negotiations is not realistic, and China has a “clear understanding” of the complexity of the negotiations.
Sun Guoxiang, a professor of International Affairs and Business at Nanhua University in Taiwan, told Epoch Times that Trump’s high-profile claim of “significant progress” serves to set an optimistic tone and shape the dominant atmosphere. China’s cautious attitude towards negotiations aims to manage internal expectations and prevent excessive market or public optimism from backfiring, projecting a tough stance outwardly and attempting to gradually regain control, which is essentially part of diplomatic negotiation language.
Wang Guochen, an associate researcher from the First Research Institute of the China Institute of Economic Research, told Epoch Times that Trump’s statement of a “major victory” probably manifests in two aspects: Beijing’s willingness to negotiate and both sides agreeing to reduce tariffs on each other. “But I don’t believe the US will adjust tariffs until concrete actions (not just promises) are taken by both sides.”
Regarding the Chinese Communist Party mouthpiece’s statement that “solving problems in one or two negotiations is impossible,” Wang said that negotiation is bound to be a long battle because the US will not believe what China promises. For example, in the privatization of state-owned enterprises or safeguarding intellectual property rights, or even basic procurement agreements, China has not delivered on any promises in the past, and some have even regressed.
Wang further analyzed that for the US to have the Chinese government exit the market is akin to asking for China’s demise, which China cannot achieve. The purpose of both sides continuing negotiations is to see each other’s bottom line, but this type of negotiation will not reach any consensus.
Currently, the US imposes tariffs of up to 145% on most Chinese goods, with some products reaching a maximum tariff of 245%; China levies tariffs of 125% on most American goods.
Last Friday (9th), Trump posted on his social media platform Truth Social earlier in the day, suggesting that reducing tariffs from 145% to 80% might be appropriate. However, White House spokesperson Karoline Leavitt clarified to the media later that afternoon that the final figure of tariffs depends on the outcome of the US-China talks over the weekend.
Wang stated that if both sides reduce tariffs from 145% to 80%, it would be a significant victory for Trump. However, practically speaking, when tariffs exceed 60%, bilateral trade becomes very difficult, so there would be minimal actual impact. If both parties are willing to reduce tariffs to 50%, it could be considered a compromise for both Trump and Xi Jinping.
Previously, China claimed that it agreed to engage with the US only after receiving information from the US and “careful consideration,” but insider information suggests otherwise.
According to Reuters, after Trump announced tariffs on April 2, Chinese Minister of Commerce Wang Wentao secretly contacted US Secretary of Commerce Lutenik, but his request was rejected due to insufficient rank.
It is reported that while China publicly responded with toughness, Chinese officials privately grew concerned about the economic impact of tariffs. With China’s trading partners beginning negotiations with the US, China fears being isolated. One of the main reasons China is willing to make concessions is that Chinese companies are struggling to avoid bankruptcy.
Wang stated that emphasis should be placed on the location and timing of the talks. Many believe Switzerland was chosen for negotiations due to being a neutral country. However, this may not be the correct interpretation. As the US and Switzerland were originally scheduled to engage in trade talks these days, China joining in was evidently unexpected. “So, the Beijing authorities were eager to negotiate with the US. Conversely, if it was the US side eager to negotiate, because two days later (May 12) there will be a Sino-French finance and economics summit, US-China talks should have taken place in France.”
Affected by the US-China tariff war, the Chinese economy continues to contract. The Caixin China Service Purchasing Managers’ Index (PMI) announced on May 6 for April was 50.7, down 1.2 points from March, marking the lowest expansion rate in seven months. Data released by the National Bureau of Statistics of China on May 10 showed that in April, the year-on-year decline in the Producer Price Index (PPI) for industrial products was 2.7%, which was an increase from the 2.5% drop in March.
Official data from the end of last month indicated that in terms of Chinese manufacturing exports, in April, the new export order index was at 44.7%, down 4.3 percentage points from the previous month.
Wang stated that the tariff war intensifies pressure on the Chinese economy, and China’s options are limited, which is why they urgently seek negotiations with the US.
Regarding the future direction of the US-China tariff war, Sun Guoxiang stated that key issues include structural reform on the Chinese side, the competition for technological dominance between the US and China, the strategy of tariff tools, and the breakdown of trust and mechanisms between the US and China. “Tariffs have become a normalized weapon, and now tend towards a return to negotiations. Chinese pressure is rising, the US is resetting, and there is a trend of multilateral cooperation.”
He analyzed three possible paths for the future of US-China negotiations, the first being a small-scale agreement on tariff reduction and procurement exchanges but unable to touch the red lines of technology and system; the second being a structural decoupling; the third involving trade tools being more used as political retaliation, leading to increased geopolitical tensions, “Ultimately, the core of this tariff war is not price but the competition of systems and order.”
Wang stated that Trump initiated the tariff war firstly targeting unfair trade practices, and the second level is China’s economic security threats abroad.
“Many experts believe that Trump’s goal is to crush the Chinese Communist Party, but I don’t hold such a strong opinion. However, if Trump wants to make America great again, he still needs to deal with China, whether by placing it as the top priority or second. Complete institutional reform in China is necessary to ensure US interests.”