US Treasury chief to meet China counterpart as tensions flare
Bessent’s high-level meeting comes as trade tensions flare between Washington and Beijing over China’s announcement of tighter export controls on its critical rare earth industry.
The Group of Seven Finance Ministers agreed this week to coordinate their next moves as Washington tries to rally its allies to respond to Beijing’s new restrictions.
The rare earth controls led to a harsh reaction from US President Donald Trump, who threatened to impose a 100 percent additional customs duty on imports from China and cancel the talks expected to be held in South Korea with his Chinese counterpart Xi Jinping.
But Trump said in an excerpt from an interview with Fox News on Friday that he would ultimately meet Xi at the Asia-Pacific Economic Cooperation (APEC) summit.
Bessent told reporters at the White House on Friday that he believed “things have calmed down” between both countries. He added later on Friday that he would speak with China’s He before both meet in Malaysia “probably a week from tomorrow to prepare for a meeting between the two presidents.” Bessent has previously accused China of trying to harm the world economy with new rare earth controls.
International Monetary Fund chief Kristalina Georgieva also expressed hope on Friday for an agreement to ease tensions between the countries.
– Coordinated intervention –
G7 finance ministers agreed for now to coordinate their short-term response to China’s export rules and diversify suppliers, EU economic commissioner Valdis Dombrovskis told reporters in Washington.
Speaking after the group’s meeting this week, Dombrovskis noted that the vast majority of rare earth supplies come from China, meaning diversification could take years.
“We agreed to coordinate our approach both bilaterally with the United States and at the G7 level,” he said on the sidelines of the autumn meetings of the International Monetary Fund and World Bank. he said.
The official added that the countries will also exchange information about their contacts with their Chinese counterparts while working on short-term solutions.
German Finance Minister Lars Klingbeil told reporters he hoped Trump and Xi’s meeting would help resolve much of the US-China trade dispute.
“We have made it clear within the G7 that we do not agree with China’s approach,” he added, referring to the group consisting of Britain, Canada, France, Germany, Italy, Japan and the United States.
Trade tensions between the US and China have reignited this year as Trump imposed sweeping tariffs on US imports and both countries retaliated tit-for-tat.
At one point, tariffs on both sides rose to triple-digit levels, effectively halting some trade while businesses waited for a solution.
The two countries have since reduced their respective tariff levels but the ceasefire remains tenuous.
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