Trump applauds 'total reset' in US-China trade talks

US President Donald Trump celebrated a "total reset" in US-China trade relations, ahead of the second day of talks between US and Chinese officials aimed at easing tensions caused by the US's aggressive tariff policy.

In a Sunday Truth Social post, Trump praised the "very good" discussions, calling them "a total reset negotiated in a friendly, but constructive, manner."

The second round of closed-door talks, led by US Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer, and Chinese Vice Premier He Lifeng, was set to resume in the morning, according to an insider familiar with the discussions.

Economist Nathan Sheets from Citigroup emphasized that both nations ultimately lose from the high tariffs, describing them as a "lose-lose proposition."

The negotiations mark the first direct meeting between senior officials from the world's two largest economies since Trump introduced heavy tariffs on China, prompting a strong retaliatory response from Beijing. The new tariffs on Chinese imports have reached 145%, with some US duties on Chinese goods soaring to 245%.

In retaliation, China imposed 125% tariffs on US products, creating what seemed like a near trade embargo between the two countries.

Before the meeting, Trump suggested on social media that a reduction in tariffs might be possible, proposing an "80% Tariff on China." However, press secretary Karoline Leavitt clarified that the US would not lower tariffs unilaterally, requiring China to also make concessions.

The first day of talks took place in Geneva at the Swiss ambassador’s residence, a neutral location. Both sides expressed caution about expecting significant changes, with Bessent emphasizing the focus on "de-escalation" rather than a "big trade deal," and Beijing urging the US to ease tariffs first.

China's state news agency, Xinhua, described the talks as "an important step" in addressing the trade issue. Experts, including Gary Hufbauer from the Peterson Institute for International Economics (PIIE), noted that while the talks were a positive development for businesses and financial markets, he remained skeptical that trade relations would return to normal.

China's Vice Premier entered the talks encouraged by news of an unexpected rise in exports, attributed to rerouted trade to Southeast Asia in response to US tariffs. Hufbauer suggested that China is better equipped to manage the trade war than the US.

The Geneva meeting followed Trump’s announcement of a trade agreement with Britain, the first such deal since his global tariff initiative. The US-UK deal, although non-binding, reassured investors by confirming the US's willingness to negotiate sector-specific tariff relief while maintaining a baseline levy on British goods.

Despite the positive rhetoric, analysts remain cautious about the outcomes of the US-China trade talks, with limited expectations for significant changes. Both Sheets and Hufbauer suggested that while the talks might be framed as productive, they may not result in any tariff reductions.

In his Truth Social post, Trump stated that the discussions had made "GREAT PROGRESS!!" and expressed his hope for greater access to Chinese markets for American businesses.