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China Hints at Possible Thaw With US in Weighing Trade Talks
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May 2, 2025
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52:03
3:31Now PlayingChina said it is assessing the possibility of trade talks with the US, the first sign since Donald Trump hiked tariffs last month that negotiations could begin between the two sides.
Bloomberg's Enda Curran reports.
China’s Commerce Ministry said in a Friday statement that it had noted senior US officials repeatedly expressing their willingness to talk to Beijing about tariffs, and urged officials in Washington to show “sincerity” toward China.
“The US has recently sent messages to China through relevant parties, hoping to start talks with China,” the ministry added. “China is currently evaluating this.”
Separately, the Wall Street Journal reported that Beijing had approached the Trump administration to ask what changes the US was seeking in relation to the production of precursor chemicals that are used to make fentanyl. Chinese officials are also considering whether to dispatch senior officials, including security czar Wang Xiaohong, to meet with US counterparts as they weigh approaches to thaw trade relations, according to the report.
US stocks rose on Friday following the signals from Beijing, as well as positive hiring data. That put the S&P 500 Index on track to erase all of the losses Trump’s tariff announcement last month, as investors grew more optimistic about the prospect for trade agreements.
The Chinese statement signaled the stalemate between the world’s two largest economies could shift, after Trump hiked US tariffs to the highest level in a century and Beijing retaliated in kind.
China has also quietly started to exempt roughly $40 billion worth of US goods from tariffs, in an apparent effort to soften the blow of the trade war on its own economy. A list of 131 excepted products is circulating among traders and businesses, which highlights areas where Beijing relies on American products, including pharmaceuticals and industrial chemicals.
Still, there is a long way to go for the US and China to get talks off the ground. Trump has repeatedly said President Xi Jinping needs to contact him in order to begin tariff talks. Earlier this week, Treasury Secretary Scott Bessent said it’s up to Beijing to take the first step to de-escalate the dispute.
John Gong, a former consultant to China’s Commerce Ministry, likened the latest gesture to “the first rain after a long drought.” It suggests “there’s a go-ahead from the very top of the leadership in China,” according to Gong, who’s now a professor at the University of International Business and Economics in Beijing.
“They are preparing for the negotiation, who’s going to lead the negotiation, what would be the strategy, what is the model like to deal with Washington,” he told Bloomberg Television. “All these things are currently probably being intensively debated and discussed right now.”
The economic fallout from the confrontation may be giving new momentum to efforts to bring both sides to the negotiating table. The US economy contracted at the start of the year largely because of a monumental surge of imports to get ahead of the tariffs that have roiled global financial markets and caused consumer confidence to plummet.
In China, factory activity slipped into the worst contraction since December 2023, the official manufacturing purchasing managers’ index showed this week. New export orders fell to the lowest since December 2022 and recorded the biggest drop since April that year, when Shanghai entered a citywide pandemic lockdown.
But hurdles still lie ahead. Beijing has been looking for the US to appoint a point person for talks who has Trump’s support and can help prepare a deal that the American president and the Chinese leader can sign when they meet.
And while countries like India and Japan seek out their own agreements with the US, China risks finding itself increasingly isolated as the sole major economy not to mount a campaign to strike a deal.
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