President Donald Trump’s administration doesn’t seem to be pushing trade deals as quickly as once promised.
U.S. Treasury Secretary Scott Bessent told CNBC in an interview Monday morning that while “talks are moving along” with other nations working to negotiate trade deals, some negotiations have yet to bear fruit ahead of Aug. 1. That date was an extended deadline for countries lagging on trade deals with the U.S.
“The important thing here is the quality of the deal, not the timing of the deals,” Bessent said on CNBC’s Squawk Box. “We are more concerned with high-quality deals than getting these deals done by Aug. 1. Our trading partners were told that the rates could boomerang back toward the April 2 levels. We can continue talking then.”
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Bessent said any further deadline extensions for trade deals would rely on Trump’s discretion.
“We’ll see what the president wants to do,” Bessent said.
The secretary said that some trade deals have marked powerful forward movement for the U.S.’ interests. A prime example, he boasted, is Indonesia, where the administration “saw five turns of their offers” spanning over several months, eventually yielding an offer up to snuff with what the administration sought.
“I thought their first offer was very good. They came back; the offer kept getting better and better, and we ended up with a fantastic trade agreement,” he said. “We have a 19 percent tariff on them. They have zero tariffs on us, and they are going to do a massive purchase of agriculture and Boeing planes. So, that’s what a good trade deal looks like, but there must have been five iterations of that.”
The secretary did not provide much detail on the state of contentious trade deals, such as the back-and-forth dialogue that has seen European Union leaders threatening to lash back if a deal has not been reached by the outset of next month.
Bessent simply said that the dealmaking scape “doesn’t have to get ugly” with the EU.
He said the administration is “going to be engaging in talks in the very near future” with China, and noted that “the talks are in a very good place.”
The pause on triple-digit tariffs on Chinese goods is set to expire after the August deadline for other countries, unless the two nations reach a deal. But despite Bessent’s apparent optimism about the future of trade with the sourcing stronghold, it seems the administration continues to harbor some qualms with the state of business in China.
He noted that the Chinese remain “very large purchasers of sanctioned Iranian oil, sanctioned Russian oil” and suggested that would be part of the discussion. But he also highlighted what the Trump administration sees as an economic imbalance because of China’s manufacturing power.
“We could also discuss the elephant in the room, which is this great rebalancing that the Chinese need to do. They have 30 percent of the world’s export manufacturing, and that can’t get any bigger, and it should probably shrink,” he said. “What the rest of the world is seeing is, now that we put up this tariff wall around China, China is not manufacturing any less, so those goods are going to Europe, Canada, Australia, into the Global South and flooding those markets.”
The Trump administration has placed an onus on domestic manufacturing, particularly in lucrative industries like technology and defense. While Bessent did not mention what, exactly, a suggested “rebalancing” would entail, Trump and his allies have been keen on trying to pivot some business away from Chinese manufacturers.
Federal Reserve Bank of New York President John Williams said last week that while the economy remains solid, the continued uncertainty over tariffs could see markets changing going forward
“It’s important to note that it’s still early days for the effects of tariffs, which take time to come into full force,” Williams said. “Although we are only seeing relatively modest effects of tariffs in the hard aggregate data so far, I expect those effects to increase in coming months.”
Williams further noted inflation could be impacted by the eventual trade deals struck between the U.S. and other nations.
“I expect tariffs to boost inflation by about 1 percentage point over the second half of this year and the first part of next year,” he said last week.
