On Friday, President Donald Trump expressed his desire to relieve prices on China, saying that on social networks, it “seemed right” to reduce withdrawals from 145% to 80%.
The announcement arrives one day before the secretary of the Treasury, Scott Bessent, began to start commercial negotiations with Chinese officials at a meeting in Geneva, Switzerland.
The potential reduction in prices launched by Trump can avoid virtual trade stop between the two largest economies in the world, but this decision would not substantially facilitate the price increases for goods such as clothing, sneakers and toys, analysts said in ABC News.
Product shortages would also remain a possibility at the lower price rate, they added.
“A price of 80% would always have a dramatic effect,” News Christian Vom Lehn, professor of economics at Brigham Young University, told ABC News. “This would mean a significant impact for consumers.”
Trump last month greatly increased prices on China, which prompted China to retaliate with 125% prices on American products. Tit-form measures launched a trade war with the third American trading partner, which represented nearly $ 440 billion in imports last year.
The prices have caused warnings of a multitude of companies on the risk of increasing prices for American buyers.
The Mattel toy giant warned in a report on the results this week of plans to move part of its supply chain outside of China, adding that if necessary, it would be necessary “pricing measures in its American activities”. This decision follows similar messages from the Best Buy electronic channel as well as Chinese electronic commerce retailers Shein and TEMU.
Chinese expeditions to the United States fell significantly, down 21% in April compared to a year earlier, data from the general customs administration by China showed on Friday.
The risks for consumers would continue to dwell for two key reasons, said analysts: an 80% rate would always represent a punistent tax on imports, while uncertainty about the risk of another change in policy would make it difficult for companies to take full advantage of the lower rate.
The prices increase prices for consumers if importers fail to swallow the tax burden by eating in their profits or asking a supplier to sell the product at a lower rate in order to compensate for a share of the cost.
Under the current 145% price on Chinese products, suppliers and importers are faced with immense pressure while they are trying to bear part of the tax cost for the sake that higher prices harm sales, experts said in ABC News. However, due to the Heaven-Haut price, many sellers have no choice but to increase prices or risk losses, they added.
These dynamics would remain in place at a rate rate of 80%, because it would far exceed the capacity of many companies to compensate for the additional cost with lower profits, Jason Miller, professor of management chain at Michigan State University.
“A price of 80% really doesn’t change things too much,” said Miller.
The workers put the final touch to clothes in a company that produces for the domestic market and for export, in an industrial textile park in Shaoxing, in the Chinese province of Zhejiang on May 9, 2025.
Greg Baker / AFP via Getty Images
Trump’s announcement of a potential reduction in the price on China occurred two days after Trump excluded such a drop in the rate level before negotiations.
The developments followed a back and forth of several weeks in which the two parties challenged if they had already started to discuss the prices.
The general feeling of uncertainty would remain even after the American prices had to reach 80%, which makes it difficult for companies to adapt their supply chains in a way that would considerably facilitate costs and, in turn, relieve consumers, said some analysts.
“Even at a lower rate, companies should wonder if it could go back or perhaps again,” said David Andolfatto, economist at the University of Miami, ABC News.
If companies could trust the level of the 80% rate as a long -term political position, they can choose to re -supply the supply chains outside of China or even launch plans for national production, said Fololfatto.
But each announcement of commercial policy presented by Trump seems to be subject to a change, said Fololfatto, noting several modifications already undertaken by Trump.
“If something changes, the Trump administration can react unilaterally and return to the negotiation table,” added Fololfatto.
For his part, Bessent described the approach of the White House as a negotiation tactic, describing policy changes as a “strategic uncertainty”.
Speaking in front of a chamber subcommittee this week, Bessent said that the Trump administration had started negotiations with 17 of the 18 best American trade partners, excluding China. These countries represent the vast majority of American foreign trade, said Bessent.
Trump unveiled on Thursday the framework of a trade agreement with the United Kingdom, marking the first agreement of this type with any nation since the White House suspended some of its major “liberation day” prices last month.
“Each country wants to conclude agreements,” said Trump in the oval office on Thursday, noting the next talks between Bessente officials and Chinese officials.
“It will be very interesting,” said Trump.
