Trump advises Bessent to keep the 10% tariff baseline ahead of the US-China Geneva talks

In a provocative move ahead of crucial trade talks in Geneva, US President Donald Trump announced that an 80 per cent tariff on Chinese goods “seems right,” marking the first time he has floated a specific figure since his administration imposed sweeping levies of up to 145 per cent on imports from China. The statement, posted on Trump’s Truth Social account on May 9, comes just hours before US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer meet Chinese economic chief He Lifeng in Switzerland, in what officials are calling a tentative first step toward resolving deep-rooted trade tensions between the world’s two largest economies.

“China should open up its market to the USA, it would be so good for them!!! Closed markets don’t work anymore!!!” Trump wrote. He added, “80% tariff on China seems right. Up to Scott B,” signalling his delegation to explore the feasibility of this new benchmark. According to Reuters, this is Trump’s first public suggestion of a specific alternative to the existing tariff structure, which has drawn criticism from industry leaders and allies alike for disrupting global supply chains. Financial markets responded swiftly, with US stock futures dipping and the dollar weakening in Europe before stabilising later in the day.

Speaking from the Oval Office on May 9, Trump said the US would maintain a baseline tariff of 10 per cent on imports even after trade deals are struck, allowing exemptions only for countries offering “significant trade terms.” He suggested that new trade agreements are on the horizon, stating, “We always have a baseline of 10%,” and hinted that Bessent had been given room to negotiate down from the current tariff ceiling. The Geneva meeting represents the first face-to-face encounter between US and Chinese trade officials since Trump returned to the White House.

Since taking office for a second term, Trump has escalated his trade offensive, slapping 145 per cent average tariffs on Chinese imports, adding to the tariffs imposed during his first term and those maintained by the Biden administration. In retaliation, China has raised its tariffs on US goods to as high as 125 per cent and imposed export restrictions on rare earth elements vital to sectors like defence, electronics, and green energy. Beijing has also targeted high-profile American exports such as soybeans and liquefied natural gas, intensifying the economic standoff.

The US-China trade talks in Geneva are taking place today, Saturday, May 10, 2025. This meeting marks the first direct negotiation between top officials from both nations since Trump returned to the presidency. US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are representing Washington, while Chinese Vice Premier He Lifeng is leading Beijing’s delegation. The talks aim to reopen stalled economic dialogue without preconditions, according to the US Treasury Department—a move interpreted by analysts as a cautious attempt to de-escalate.

However, the context remains tense. Trump’s public push for an 80 per cent tariff, despite being a step down from the current 145 per cent, may complicate diplomatic efforts. China’s reciprocal tariffs of up to 125 per cent and strategic export curbs on rare earth materials continue to set a combative tone. Whether today’s talks lead to substantive progress or serve as a diplomatic reset remains uncertain.

Despite the political posturing, economic data paints a picture of deep interdependence between the two superpowers. According to the US Census Bureau, in 2023, the US imported $427 billion worth of goods from China, making it the country’s third-largest trading partner after Mexico and Canada. At the same time, US exports to China totalled $148 billion, with key outbound products including soybeans, semiconductors, aircraft, and LNG.

From Beijing’s side, the US was China’s second-largest export market in 2023, accounting for around 15 per cent of its total exports, according to China’s General Administration of Customs. This mutual reliance complicates any attempt at economic decoupling.

Whether Geneva will mark a turning point or simply another headline in the US-China economic standoff remains to be seen. But what is clear is that decisions taken in this weekend’s meeting could have far-reaching implications for global trade flows, supply chains, and investor confidence.