"Trump’s China Truce on Tariffs Comes with Cost to U.S. Credibility" - by CWP alum Zongyuan Zoe Liu

The trade talks in Geneva between the United States and China yielded greater-than-expected de-escalation in the ongoing trade war, but it won’t be so easy to undo the damage this skirmish has done to U.S. trade credibility and the role of the dollar on the global stage.

The two sides agreed to a point-for-point mutual reduction in their respective tariff rates for an initial period of ninety days, bringing rates down to near the same levels that prevailed before the tit-for-tat escalation. This reduction of 115 percentage points lowers the U.S. tariff rate on Chinese imports to 30 percent and 10 percent on U.S. goods flowing the other way.

U.S.-China trade talks in Geneva resulted in a temporary slash of tariff rates, but the ripple effect of this tit-for-tat escalation won’t disappear anytime soon.

Expert Brief by Zongyuan Zoe Liu - May 12, 2025 7:04 pm (EST) - 

Zongyuan Zoe Liu is the Maurice R. Greenberg senior fellow for China studies at the Council on Foreign Relations.

Photo Credit: https://www.cfr.org/expert-brief/trumps-china-truce-tariffs-comes-cost-us-credibility