The UK trade agreement was the easy part. China will be exponentially harder

As Trump administration officials prepare to meet with Chinese officials in Geneva this weekend, it’s tempting to believe the momentum from the United Kingdom trade deal announcement on Thursday will carry over. Don’t hold your breath.

As Trump administration officials prepare to meet with Chinese officials in Geneva this weekend, it’s tempting to believe the momentum from the United Kingdom trade deal announcement on Thursday will carry over. Don’t hold your breath. “I’m keeping my expectations in check. Tariffs are high. Tensions are high. It’s easier to impose tariffs than to unwind them,” said Wendy Cutler, a former US trade negotiator who is now vice president of the Asia Society Policy Institute. President Donald Trump despises trade deficits — a situation when the US buys more from another country than it sells. In his view, it’s a sign that America is being “ripped off” and treated unfairly. (Economists are much less convinced of his argument.) Since China is the world’s second-largest economy and a manufacturing supercenter, it’s perhaps unsurprising that, across all trading partners, the US ran the largest trade deficit with Beijing last year, at nearly $300 billion. Trump has therefore levied the steepest tariffs on China, with rates starting at a whopping 145% for most products. China responded by slapping a minimum tariff of 125% on most US goods. Both countries’ economies are poised to take massive hits from the trade war, and bruises are already beginning to appear on both sides. Investors and many businesses and consumers from both countries are eager to see the situation improve and are holding out hope that the weekend talks, which mark the first official dialogue between top US and Chinese government officials during Trump’s second term, will help. But it could quickly turn south, too.