Trump Proposes Major Cut in China Tariffs, Signaling Shift in Trade War

President Donald Trump has expressed a readiness to drastically cut U.S. tariffs on Chinese imports, hinting at a potential 80% tariff as the new rate.

What Happened: President Trump is considering a significant reduction in tariffs on Chinese goods. This move is interpreted as an effort to advance in the ongoing trade war, sparked by Trump’s “Liberation Day” announcement.

The existing tariffs have notably influenced Wall Street and have sparked worries about a possible U.S. recession. They have also negatively impacted Trump’s approval ratings.

Trump, in a post on Truth Social, proposed that an 80% tariff on China seemed fitting. This would substantially lower the import tax on Beijing's goods from the current 145%. “80% Tariff on China seems right! Up to Scott B,” Trump wrote.

He also alluded to Treasury Department Secretary Scott Bessent’s role in the decision.

The U.S. and China are set to engage in trade talks in Switzerland this weekend, with Bessent spearheading the discussions. Trump’s suggested tariff reduction comes as Beijing has been hesitant to negotiate a deal with the U.S., despite the potential harm to its own economy.

Also Read: Young Americans Express Discontent Over Trump’s China Tariffs

In another post on Friday, Trump said, “CHINA SHOULD OPEN UP ITS MARKET TO USA — WOULD BE SO GOOD FOR THEM!!! CLOSED MARKETS DON'T WORK ANYMORE!!!"

Trump’s economic management has seen approval ratings fall below 50% in most polls, stirring unease among Republicans with the midterm elections just over a year away.

Despite the ongoing trade disputes, the prospect of U.S.-China talks has been received positively by markets, with Germany's DAX, Paris's CAC 40, and the U.K.'s FTSE 100 all recording gains.

Why It Matters: The proposed tariff reduction signifies a potential shift in the U.S.-China trade war. The current tariffs have not only impacted Wall Street but also raised concerns about a U.S. recession and affected Trump’s approval ratings.

The move could potentially ease these concerns and improve the economic outlook. However, the success of this proposal largely depends on the upcoming trade talks in Switzerland and Beijing’s willingness to negotiate a deal.

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