The United States and China are holding high-level talks at Geneva in Switzerland in a possible thaw in the trade war sparked by massive tariffs imposed by US President Donald Trump. Chinese state media today reported that Vice Premier He Lifeng is leading the talks on the Chinese side, while US Treasury Secretary Scott Bessent is America’s chief representative. Mr Bessent urged the public earlier this week not to expect a major trade deal out of the meetings, but he acknowledged it was an important step in negotiations.

The US has placed a minimum 145 per cent tariff on most Chinese imports, and China has responded with a 125 per cent tariff on most US imports. According to logistics experts, trade between the two sides is falling sharply as a result.

Even reducing that tariff rate by half still might not be enough to change trade levels significantly. Economists have said 50 per cent is the make-or-break threshold for the return of somewhat normal business between the two countries. Yesterday, hours after America’s chief representative, Bessent and trade representative, Jamieson Greer, had set off for Switzerland, President Trump floated the possibility of slashing tariffs on Chinese goods to 80 per cent while demanding China open up its market to the USA.

The combination of fewer goods arriving in the US and increased costs on imports that do arrive has already started pushing up prices for Americans.