Bessent Predicts Likely U.S.-China Trade Deal on Reciprocal Tariffs Before November Deadline

Treasury Secretary Scott Bessent expressed confidence on Tuesday that a U.S.-China trade deal is likely in the near future, emphasizing that negotiations are advancing positively amid ongoing discussions regarding reciprocal tariffs. Bessent spoke in a CNBC interview, noting that further talks are expected before the November implementation of these tariffs, which have been a central point in U.S.-China trade relations. “We’ll be seeing each other again,” he remarked during the discussion on Squawk Box, highlighting that each round of talks has become increasingly productive. He believes that Chinese officials now recognize that a mutually beneficial trade agreement is possible.

The backdrop of these discussions traces back to April 2, 2025, when former President Donald Trump initially imposed so-called “liberation day” duties on several U.S. global trading partners, including China. Under that move, China faced tariffs that could reach up to 145%, but negotiations subsequently led to a temporary suspension of these tariffs. The initial pause on reciprocal tariffs was set to expire on August 12, but Trump later extended it to November 10, providing more time for negotiations to reach a resolution. Bessent indicated that U.S. trading partners have raised concerns about the large influx of Chinese goods into their markets, which has created significant challenges for them. He quoted partners saying they were unsure how to respond and “slightly apoplectic” about the market flooding.

In terms of trade figures, the United States recorded a nearly $300 billion trade deficit with China in 2024, highlighting the persistent imbalance in bilateral trade. However, the deficit is projected to decline significantly in 2025, with figures through July 2025 already showing a reduction to $128 billion. Bessent emphasized that U.S. Trade Representative Jamieson Greer expects the deficit to narrow by at least 30% this year, with potential for further reduction in 2026, signaling progress toward correcting the trade imbalance between the two nations.

Bessent framed the overarching goal of these negotiations as achieving balance and ensuring fair trade. He underscored that the focus of ongoing discussions is not only to reduce the trade deficit but also to establish a framework that provides long-term stability and predictability for both American and Chinese markets. By addressing the tariffs and ensuring a level playing field, the U.S. aims to create an environment where trade relations are mutually beneficial and sustainable.

The trade talks, although complex and marked by previous uncertainties, reflect a broader commitment to resolving long-standing issues between the two largest economies in the world. Analysts and investors have closely monitored these discussions, as any resolution on tariffs could significantly impact global trade flows, supply chains, and financial markets. With both sides engaged in detailed negotiations, Bessent’s remarks suggest optimism that a constructive agreement can be reached before the November deadline, potentially easing tensions and fostering more balanced trade relations.

In summary, Bessent conveyed that while challenges remain, the U.S.-China trade dialogue is moving in a positive direction, with the expectation that reciprocal tariffs will be addressed through continued negotiation, ultimately promoting fair and balanced trade between the two nations.