Trump claims China’s Xi called him on tariff deal, but Beijing says he’s ‘Misleading the public’

President Donald Trump once again claimed that Chinese President Xi Jinping called him to discuss a potential tariff deal, a statement immediately contradicted by the Chinese government. Trump’s announcement, made during an interview with Time magazine today, stated that he and Xi are engaged in discussions to lower the astronomical tariffs currently imposed on Chinese goods.

He asserted that these talks are “active” and progressing toward a “fair deal,” suggesting a significant softening of the ongoing trade war. However, China’s Foreign Ministry has already refuted Trump’s previous assertions, stating explicitly that no such negotiations or agreements have taken place.

As reported by Reuters, Spokesperson Guo Jiakun declared, “China and the U.S. have not engaged in any consultations or negotiations regarding tariffs, let alone reached an agreement.” This stark contradiction underscores the deep uncertainty surrounding the future of US-China trade relations.

Trump is still saying China called despite Beijing saying its bluster

Trump’s claim followed his earlier announcement that the 145% tariffs on Chinese goods will “come down substantially.” He framed his willingness to reduce tariffs as a strategic move, suggesting that his initial aggressive tariff policies had forced China to the negotiating table.

In his Time interview, he likened the United States to a department store, declaring, “We are a department store and we set the price. I meet with the companies, and then I set a fair price, what I consider to be a fair price, and they can pay it, or they don’t have to pay it.” He further boasted of having already brokered 200 tariff deals and predicted concluding the remaining negotiations in three to four weeks. He even defined a scenario where tariffs remain as high as 50% as a “total victory.”

The economic consequences of the protracted trade war have been substantial. Trillions of dollars have evaporated from global stock markets, the value of the dollar has plummeted, and the US economy has edged closer to recession. China’s export sector, a crucial driver of its economic growth, has also experienced significant downward pressure, with freight ship bookings plummeting in recent weeks.

These economic realities have fueled speculation that the current impasse is unsustainable. This view is supported by comments from Treasury Secretary Scott Bessent, who, according to CNBC, told investors that “no one thinks the current status quo is sustainable” and predicted a “de-escalation” in the “very near future.”

However, the lack of a formal negotiating process casts doubt on Trump’s claims of imminent progress. Experts suggest that Beijing’s strategic approach plays a crucial role in the impasse.

China’s leaders, confident in their political system’s ability to withstand economic pressure, have adopted a patient strategy, waiting for Trump to define the terms of negotiation. They have significant leverage, including control over critical minerals and inputs vital to American industries, potentially inflicting considerable economic pain on the US.