‘Everything is on the table’: US approaches China for tariff talks, revisiting ‘Phase 1’ trade deal

The United States has reportedly started talking with China about the high tariffs put in place during the Trump administration. This move could mean a possible change in the trade tensions between the two powerful economies.

According to Reuters, a social media account linked to Chinese state media, the US has actively reached out in different ways to discuss the 145% tariffs the US set and the 125% tariffs China later imposed in response. While this shows the US might be open to negotiations, the situation is still complicated. Both sides have made public statements and taken actions that seem to contradict each other.

Top US officials, including the Treasury Secretary and a White House economic advisor, have said they hope to reduce trade tensions. They have mentioned wanting to look again at the “Phase 1” trade deal signed in 2020, especially focusing on China not meeting its promise to buy more American goods, which was a major part of the agreement.

US may be approaching China for tariffs agreement

The pandemic is seen as one reason China did not fulfill these commitments, and this could play a role in new talks. Beyond just tariffs, the US also wants to discuss other issues, like non-tariff trade barriers and intellectual property theft, showing they want a broad approach to improving the economic relationship.

The US Treasury Secretary has said every part of the economic relationship could be part of the negotiations. China’s reaction has been mixed. Publicly, the Chinese government has strongly criticized the US tariffs, calling them economic bullying and a way to slow China’s economic growth. Chinese officials have repeated this position, with one spokesperson clearly saying there are no current talks or negotiations about the tariffs.

Behind this public stance, China has quietly removed some US goods, like medicines, microchips, and jet engines, from its list of retaliatory tariffs. This suggests a more careful strategy, possibly meaning China is open to talks while keeping a strong public position.

The economic risks are high. Experts have warned that if the trade conflict gets worse, the results could be very damaging. One estimate says that if Chinese exports to the US drop sharply, it could lead to millions of lost jobs in China. The US Treasury Secretary has pointed out that China depends more on exports to the US, meaning the current situation hurts China’s economy more than America’s.

This idea is reinforced by the possible effect on holiday season orders, meaning ongoing trade problems could seriously harm both economies. The situation is made more confusing by conflicting statements about whether negotiations are happening and what they involve.

While US officials say they believe a deal is possible and point to positive signs like China reducing tariffs on some US goods, China’s public denials of formal talks make it unclear exactly where these discussions stand.