WASHINGTON — The economic relationship between the United States and China has been a topic of much debate and discussion in recent years. On Friday, U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng engaged in a virtual meeting to discuss the current state of affairs between the two countries. Despite their differences, both officials agreed to continue communications and address important issues in their economic relationship.
During the call, Secretary Bessent expressed his concerns about China’s counternarcotics efforts, economic imbalances, and unfair policies. He stressed the administration’s commitment to implementing trade and economic policies that protect the American economy, workers, and national security. This sentiment was echoed in the Treasury’s readout of the meeting, which emphasized the need for China to do more to curb fentanyl trafficking and rebalance its economy.
In response, Vice Premier He expressed his concerns about President Donald Trump’s new tariffs and trade restrictions on China. He and Secretary Bessent engaged in an in-depth exchange of views on important issues in China-U.S. economic relations. Both officials agreed to continue communicating on matters of mutual concern, demonstrating their commitment to maintaining a strong economic relationship.
The importance of the bilateral economic and trade relations between the two countries was also recognized during the call. Despite recent tensions and disagreements, both sides understand the significance of their economic ties and the potential impact on their respective economies.
The call comes at a critical time as the U.S. and China are on the verge of a renewed trade war. In early February, President Trump imposed 10% tariffs on all Chinese goods, citing China’s failure to address fentanyl trafficking. In response, China retaliated with targeted tariffs on some U.S. imports and threatened sanctions against American companies. President Trump has also planned further tariffs on all countries that tax U.S. imports, which could further escalate global trade tensions.
During his election campaign, President Trump even threatened to impose 60% tariffs on all Chinese imports. This aggressive stance has caused concern among Chinese officials and has been a major point of contention in their economic relationship.
Secretary Bessent also highlighted the need for China to rebalance its economy, relying more on domestic consumption for growth and less on investment and exports. He stressed that China’s current policies are suppressing consumer spending and favoring the business community. This is a sentiment that has been previously expressed by former Treasury Secretary Janet Yellen during her meetings with Chinese officials.
In recent years, the U.S. has had a significant trade deficit with China, reaching a peak of $418.2 billion in 2018. However, in 2024, this deficit decreased to $295.4 billion, largely due to the implementation of new tariffs by President Trump. Despite this decrease, last year saw an increase of $16.3 billion from 2023 as Chinese exporters rushed to beat a new round of tariffs.
Former Treasury Secretary Yellen has also raised concerns about China’s state-led economic policies, arguing that they have led to excess production capacity and have threatened the viability of firms in the U.S. and other market economies. This warning has laid the groundwork for President Joe Biden’s decision to increase tariffs on electric vehicles, semiconductors, and solar products.
However, Chinese officials have consistently rejected these claims, arguing that their industries are simply more competitive. This difference in opinion has been a major factor in the ongoing economic tensions between the two countries.
Despite these differences, both Secretary Bessent and Vice Premier He have agreed to continue communicating and addressing important issues in their economic relationship. This is a positive sign for the future of their economic ties and demonstrates a willingness to find solutions and maintain a strong economic partnership.
The call also comes at a time when there is speculation about a potential visit from Chinese President Xi Jinping to the U.S. While no timeline has been given, President Trump has stated that he expects President Xi to visit soon. This visit could provide an opportunity for both countries to further discuss and address their economic differences and work towards finding common ground.
In conclusion, the virtual meeting between U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng was an important step towards managing the economic relationship between the two countries. Both officials expressed their concerns and engaged in an in-depth discussion, highlighting the importance of communication and cooperation in maintaining a strong economic partnership. With ongoing efforts and discussions, it is hoped that the two countries can find common ground and work towards a mutually beneficial economic relationship
