Investing.com - The Trump administration is considering a deep cut to its elevated tariff on China ahead of much-anticipated discussions between representatives from Washington and Beijing this weekend, according to Bloomberg News.
With U.S. Treasury Secretary Scott Bessent and top trade negotiator Jamieson Greer set to meet their Chinese counterparts in Switzerland on Saturday and Sunday, the U.S. is setting a target of slashing the levies to below 60%, Bloomberg reported, citing people familiar with the preparations for the negotiations.
Should there be progress in the two days of talks, those reductions could be put into place as soon as next week, although the discussions are still likely to be exploratory in nature and focus on grievances rather than figuring out solutions, Bloomberg added.
The news agency said the situation is fluid and there is no guarantee the tariffs will be brought down in the near term.
White House officials are also keen to secure the removal of Chinese restrictions on the export of rare earth materials used to make magnets, particularly as a slew of industries face possible disruptions, Bloomberg said.
Separate talks may also soon occur on fentanyl, the opiate that has been one driver of Trump’s push to place new duties on the world’s second largest economy, the report noted. Trump has called on Beijing to do more to stem the flow of the ingredients used to make the drug, which has been behind a recent spike in overdose deaths in the U.S.
Crucially, China was omitted from Trump’s decision to pause elevated "reciprocal" tariffs on dozens of countries last month, and now faces U.S. duties of at least 145%. Beijing has responded with its own reciprocal levies of 125%, sparking concerns over an intensifying trade conflict between the world’s two largest economies.
Many economists have warned that the tariffs risk denting global growth, while several businesses have flagged that uncertainty around Trump’s tariff agenda has made it more difficult to plan out future investments.
Trump suggested on Thursday that the much-anticipated discussions in Geneva will be substantive, adding that he expects the soaring tariffs would eventually be lowered. Commerce Secretary Howard Lutnick also told CNBC that "de-escalating" will considered a "good outcome" by Trump and is a "goal" of Bessent.
China’s Vice Foreign Minister has said the country has full confidence that it can handle trade issues with the U.S., adding that the draconian nature of the Trump administration’s tariff agenda cannot be sustained. Beijing has previously accused the U.S. of using the tariffs as a "coercion" tactic.