U.S. Treasury Secretary Scott Bessent on Wednesday said he thinks the Trump administration can reach tariff deals with U.S. allies as he prepares to lead negotiations with more than 70 countries in coming weeks, warning that moves to align more closely with China could backfire.
Bessent, speaking to an American Bankers Association conference in Washington, said he would take a lead negotiating role in negotiations over President Donald Trump's tariffs.
He added that despite financial market turmoil, "in general, the companies I've spoken to, people who have come, the CEOs, who have come into Treasury, tell me that the economy is very solid."
Trump's punishing tariffs, which the president says are aimed at ending U.S. trade deficits with many countries, have upended the global trading order, raising fears of recession and wiping trillions of dollars off the market value of major firms.
Global markets fell further on Wednesday as Trump's eye-watering 104% tariffs on Chinese goods came into effect, and a savage selloff in U.S. bonds sparked fears that foreign funds were fleeing U.S. assets.
Bessent said there was great interest in negotiating with the U.S. to lower tariffs, noting that Trump had already spoken with the leaders of Japan and South Korea, and U.S. officials would meet with a delegation from Vietnam on Wednesday.
"I think ... at the end of the day that we can probably reach a deal with our allies, with the other countries that have been ... good military allies and not perfect economic allies. And then we can approach China as a group," Bessent said.
He added that the sweeping reciprocal tariffs announced by Trump last week represented a ceiling for tariffs if countries didn't retaliate, but China had not heeded that advice.
"In terms of escalation, unfortunately, the biggest offender in the global trading system is China, and they're the only country who's escalated," Bessent said.
He did not comment specifically on China's latest retaliatory move, lifting tariffs on U.S. imports to 84%, although he earlier called it a losing proposition in an interview with Fox Business Network.
Speaking at the ABA event, Bessent cited comments from a senior Spanish government official who suggested that Europe should more closely align with China, saying, "That would be cutting your own throat."
Bessent warned that China would continue to produce too many goods and dumping them in markets elsewhere, even as the U.S. "tariff wall" would be keeping such goods out of the U.S. market.
