Treasury Secretary Scott Bessent suggested this weekend that President Donald Trump could have a phone conversation with Chinese leader Xi Jinping “very soon,” potentially helping to resolve growing friction between the world’s two largest economies.
The comments come as trade relations between Washington and Beijing hit another rough patch, just weeks after both countries agreed to temporarily dial down their escalating tariff war. Trump has accused China of violating terms of a deal negotiated last month in Geneva, where both sides agreed to pause their trade dispute for 90 days.
What’s Gone Wrong Since Geneva
The trouble appears to center on China’s handling of export licenses for rare earth elements and other critical materials that American companies need to manufacture cars and computer chips. According to The Wall Street Journal and US officials, China has been dragging its feet on approving these export licenses, creating supply chain headaches for American businesses.
Speaking on CBS’s “Face the Nation,” Bessent acknowledged that China was “withholding some of the products that they agreed to release during our agreement.” When pressed specifically about rare earths, he confirmed, “Yes.”
The Treasury Secretary seemed cautiously optimistic that direct communication between the two leaders could smooth things over. “I’m confident that when President Trump and Party Chairman Xi have a call that this will be ironed out,” he said, though he left open whether China’s actions were deliberate or simply bureaucratic delays.
“Maybe it’s a glitch in the Chinese system. Maybe it’s intentional. We’ll see after the president speaks with” Xi, Bessent explained.
The Bigger Picture on Tariffs
The current dispute unfolds against the backdrop of an intense trade war that has seen both countries impose punishing tariffs on each other’s goods. Since returning to office, Trump has maintained his aggressive approach to trade policy, hitting most US trading partners with sweeping tariffs and reserving particularly high rates for Chinese imports.
Before the Geneva agreement, the situation had escalated dramatically. New rounds of retaliatory tariffs from both sides had reached triple-digit percentages, creating significant costs for businesses and consumers in both countries.
The temporary de-escalation this month brought some relief. Under the Geneva deal, Washington agreed to reduce its additional tariffs on Chinese imports from a staggering 145 percent down to 30 percent. China responded by lowering its added duties from 125 percent to just 10 percent.
Officials Express Frustration
Commerce Secretary Howard Lutnick echoed the administration’s frustration with China’s recent behavior during an appearance on ABC’s “This Week.” He accused Beijing of “slow-rolling the deal” and suggested the US was prepared to respond accordingly.
“We are taking certain actions to show them what it feels like on the other side of that equation,” Lutnick said, though he didn’t specify what those actions might involve.
Despite the tough talk, Lutnick expressed confidence in Trump’s ability to resolve the situation through direct diplomacy. “Our president understands what to do. He’s going to go work it out,” he said.
What Happens Next
The timing of any potential Trump-Xi conversation remains uncertain, but Bessent’s comments suggest it could happen relatively quickly. “I believe we will see something very soon,” he told CBS.
The stakes for both economies remain high. China and the United States are deeply interconnected through trade relationships worth hundreds of billions of dollars annually. Any prolonged disruption to this relationship affects not just the two countries involved, but global supply chains and economic stability worldwide.
For American manufacturers, the current uncertainty around rare earth exports creates particular challenges. These materials are essential to the production of everything from batteries for electric vehicles to semiconductor chips, industries critical to America’s economic competitiveness.
Days to come will likely indicate whether direct leader-to-leader dialogue can once again de-escalate tensions between these economic titans, or whether the trade relationship will return to the more aggressive postures that defined much of Trump’s previous presidency.
