Trump offers $30bn tariff-cut package in Beijing to stabilize U.S.-China trade

President Donald Trump arrived in Beijing this week for talks with Chinese President Xi Jinping centered on trade, with both sides weighing a narrower package of tariff relief rather than a broader rewrite of the economic relationship. U.S. officials have discussed cutting tariffs on about $30 billion of imports on each side and building a mechanism for trade in goods deemed non-sensitive, according to Reuters. The approach would preserve wider tariffs and export controls tied to national security while trying to prevent new commercial disputes from spilling into a broader rupture. The talks build on a May 12, 2025 joint U.S.-China statement in Geneva that created a standing mechanism for further economic and trade discussions. ### Why are Trump and Xi talking about only part of the trade relationship? Reuters reported on May 13 that the proposed package would cover roughly $30 billion worth of imports on each side, focused on goods that do not cross what officials described as national security red lines. That is a narrower objective than earlier U.S. efforts that sought structural changes in China’s state-led economic model. (usnews.com) Jamieson Greer, the U.S. trade representative, said last week that the goal was not to make China “change the way they govern” or “manage their economy,” according to Reuters’ account of his Fox Business interview. Greer instead described trying to identify where the two sides could “optimize trade” and likened the arrangement to an “adapter” connecting two different systems. (usnews.com) ### Where did this framework come from? The White House said in the May 12, 2025 joint statement issued after talks in Geneva that Washington and Beijing would establish a mechanism to continue discussions about economic and trade relations. The statement named Chinese Vice Premier He Lifeng as Beijing’s representative and Treasury Secretary Scott Bessent and Greer as the U.S. representatives. (usnews.com) The same Geneva statement said the United States would suspend 24 percentage points of additional duties for an initial 90 days while retaining a 10% rate, and China would make corresponding changes on U.S. goods and suspend or remove non-tariff countermeasures taken since April 2, 2025. A White House executive order issued the same day said those talks were a “significant step” toward addressing U.S. concerns over trade reciprocity and national security. (whitehouse.gov) ### What would a “managed” trade mechanism look like? Reuters said Greer first raised the idea in March as a possible summit deliverable under the name “Board of Trade.” The concept, as described by Reuters, is to set numerical targets or baskets for trade in non-strategic sectors while leaving in place broader restrictions on sensitive technologies. (whitehouse.gov) Wendy Cutler, a former U.S. trade negotiator who now heads the Asia Society Policy Center, told Reuters that both governments were “coalescing around” a basket of roughly $30 billion to $50 billion in goods that could face lower tariffs or other reduced barriers. Reuters also reported that it was still unclear whether Trump and Xi themselves would identify specific goods in Beijing or leave that work to later meetings. (usnews.com) ### What is not being solved in Beijing? Reuters reported that the planned trade package would leave broader disputes untouched, including controls and tariffs tied to national security-sensitive sectors. The proposal, as described by Reuters, is meant to create guardrails for commerce in non-sensitive goods rather than settle the wider contest over technology, security and strategic supply chains. (usnews.com) The White House’s 2025 statements also framed the tariff changes as part of a continuing process, not a final settlement. In its Geneva release, the administration said the parties could hold working-level consultations on relevant economic and trade issues and conduct talks alternately in China, the United States or a third country. (usnews.com) ### Who carries the negotiations from here? Scott Bessent and He Lifeng met for three hours in Incheon, South Korea, on May 13 to prepare economic proposals for the Beijing summit, Reuters reported. Reuters said the officials did not issue a statement afterward, underscoring that the details remained unsettled going into the leaders’ meetings. (whitehouse.gov) The next formal channel is already defined. The Geneva mechanism names Bessent, Greer and He as the officials responsible for continuing the talks, with further meetings to be held in China, the United States or another agreed location. (whitehouse.gov) (usnews.com)