Inside Trump’s negotiating strategy with China

A few hours after President Donald Trump’s trade negotiating team boarded a flight for the most important economic meetings in the world, their boss took to social media to publicly throw a curveball into the negotiations. That was the point – not necessarily the path. Trump’s decision to float the possibility of cutting his 145% tariffs on China to 80% gave the impression that Trump was negotiating with himself before the discussions started. But the substance of the message, was not a surprise to his top negotiators, who have discussed the possibility of lowering America’s tariff on China in internal discussions ahead of the US-China talks in Geneva, Switzerland. But it was certainly news to Chinese officials. Trump’s feigned deference to Treasury Secretary Scott Bessent, who he said in the post would make any final decision, was intended to elevate “Scott B” in the eyes of his Chinese counterparts. In reality, US officials are clear-eyed about the fact it will be Trump and Chinese leader Xi Jinping who will ultimately need to cement any major agreement. Bessent and US Trade Representative Jamieson Greer landed in Geneva, Switzerland, for two days of meetings with top Chinese officials eyeing what may be viewed as less ambitious, but no less important, outcomes. White House officials have made clear they view the China talks on a separate track than the furious scramble to secure trade agreements with dozens of other nations. Those negotiations are officially on the clock after Trump’s decision to pause the April 2nd “reciprocal” tariff rates for 90 days. Trump’s advisors have framed some of those bilateral negotiations as another lever to exert pressure on China’s economy, with a specific focus on securing early agreements with Indo-Pacific countries including South Korea and Japan. The White House approach to China is defined in its nascent stages as an altogether different approach separate and apart from the roughly 20 prioritized negotiations under way. Administration officials have framed a process intended to start with mutual steps toward de-escalation, followed by demands for specific moves by China to address Trump’s priorities, such as the facilitation of fentanyl production and resuscitating the first term US-China “Phase One” trade deal. Those steps would set the stage for more expansive discussions about the broader trade and economic relationship between the two nations. “This talk is about: Can we get to a stable place and maybe that’s a foundation for something more,” Greer said Thursday in an interview with CNBC. More immediate US concerns over export controls placed by China on rare earths may also drive potential early-stage agreements, but any kind of wide-ranging agreement is at best a long-term process. Unless, of course, Trump decides otherwise. Normal diplomacy vs. Trump’s wild card Current and former administration economic advisors preface most conversations about negotiations with some variation of the fact Trump is the wild card that may decide to change course at any time. But Trump’s advisers are using this weekend’s meeting to forge a path out of a persistent and dangerous state of paralysis. They’ve seen positive signals in the lead up to talks that, after a monthslong stare own, came together in a familiar and deeply choreographed way. Both sides announced the scheduled meetings in a roughly coordinated fashion. Both sides insisted their top negotiators just happened to be passing through a city that has long served as a neutral third-country site for the most contentious diplomatic relationships. Both sides have generally maintained their public red lines that would seem to ensure little progress, while also messaging a new degree of flexibility through associated outlets. The officials set to lead the talks from both sides are the most tangible sign that the talks are serious and designed to substantively move toward de-escalation. He Lifeng, Xi’s top economic official and a long member of the Chinese leader’s inner circle, will lead the Chinese delegation. Wang Xiaohong, Xi’s top security aide, was also expected to attend, according to two people familiar with matter. Greer, who has engaged with most of the trade and economic officials expected to attend the meetings during his time across Trump’s first and second terms, said the manifest represented “folks who are serious.” “They’re sending real people to talk to us about real issues, so I’m confident that we can have a straightforward and candid discussion with these folks,” Greer said on CNBC. Bessent has become the public face of Trump’s economic team. Greer, a senior trade official in Trump’s first term who has played an increasingly central role within Trump’s economic team since his February Senate confirmation, brings a similar level of gravitas for the US side. National Economic Council Director Kevin Hassett, who spoke to Bessent and Greer shortly before they boarded their flight Thursday evening, told reporters at the White House there have been “very promising signs” from the China side ahead of the meetings. He called the lead up the meeting an environment both sides have approached with “respect, collegiality and sketches of positive developments.” That baseline level of professional diplomacy is a stark shift from the first month of Trump’s second term, where Chinese officials tried in vain to connect with US counterparts and inner circle advisors, according to several people familiar with the matter. That left Chinese officials in a state of “frustration and confusion,” according to a European diplomat briefed on the matter. What soon became clear, the diplomat said, was how serious Trump was about completely re-orienting the bilateral relationship – and that his method would be economic force. China’s retaliation, which Trump and his advisors warned against, didn’t come as a surprise. But it did deepen a rupture in the relationship that threatens the global economy and has already created significant stress on the domestic economies of both nations. US officials have made clear publicly – and maintain privately – that the Chinese economy simply can’t sustain a drawn out trade war with the United States. They’ve been bolstered in that view by recent economic data they say underscores a combination of existing fragility in the country’s economic system and the acute risk posed by a de facto trade embargo with the world’s largest economy. Trump’s white whale The American officials pointed to quiet outreach from Chinese officials that sparked the planning for the meeting, with a top Xi security advisor communicating a desire to work toward addressing Trump’s major problems on the fentanyl issue. Trump’s fixation with Xi and a potential sweeping economic deal has been a prominent public feature of his first and second terms in the White House, often to the chagrin of his most hardline advisors. They view his overarching assessment of China as clear-eyed and focused on mitigating economic and security vulnerabilities. But there are no shortage of very specific examples of his willingness to break from any kind of linear hawkish approach. The pursuit of a grand economic deal may tempt him once again. “It’s his white whale,” a first-term Trump White House official told CNN. “Think of it like his desire to win the Nobel Peace Prize – a huge China deal is the economic version of that.”