The world’s economy, particularly trade relations, has long been a topic of intense scrutiny and diplomatic engagement, with major players like the United States and China at the center of this global economic stage. On May 8, 2025, a pivotal meeting took place in Geneva, where U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer met with a high-ranking Chinese delegation, headed by Vice Premier He Lifeng. This meeting held the promise of addressing some of the most pressing trade concerns between the two largest economies in the world, as tariffs and economic tensions have created waves of uncertainty, not only in these countries but in global financial markets as well.
The stakes were high. With the U.S. and China having imposed eye-watering tariffs on each other’s goods for several years, the meeting in Geneva was seen as an opportunity to de-escalate the ongoing trade war. Despite the strong desire for resolution, the prospects of a significant breakthrough appeared bleak, with both sides having entrenched positions on key issues, and no clear path to reducing the tensions. However, there was hope that the meeting might signal a path forward to scaling back the enormous tariffs that have been stifling trade, which, in turn, has placed immense pressure on global financial markets and multinational companies that depend on smooth trade relations between the two economic giants.
The tariff war began under the administration of U.S. President Donald Trump, whose combative trade policies and aggressive use of tariffs were a defining feature of his economic approach. The U.S. raised tariffs on Chinese goods, reaching an astonishing combined total of 145%, a level of taxation that in many respects amounts to a de facto boycott of Chinese products. In retaliation, China imposed tariffs of up to 125% on American goods, leading to a significant disruption in trade, especially in the context of the 660 billion dollars of trade that passed between the two countries in 2024. The imposition of such high tariffs, which were expected to intensify the already fraught relations between the two nations, sent shockwaves across international markets, prompting urgent calls for dialogue and negotiation.
The crisis has escalated tensions not only between the U.S. and China but also within their respective economies. In a recent post on Truth Social, President Trump suggested that the U.S. might reduce tariffs to 80% in an attempt to reignite negotiations. This suggestion came at a time when President Trump was still actively driving the aggressive trade policies against China. His suggestion, as seen in the post, further indicates a complex balancing act between the harsh economic policies and the possibility of easing tensions, though the path to achieving any meaningful reduction of tariffs is fraught with political and economic complexities.
For China, the trade conflict with the United States is about much more than tariffs. It also involves issues of technology policy, intellectual property rights, and long-standing accusations from the U.S. about unfair trade practices, such as forced technology transfers and government subsidies to Chinese firms. China has repeatedly denied any wrongdoing, and the lack of significant movement on these issues during previous rounds of talks—particularly the Phase One agreement in 2020—has fueled a sense of mistrust between the two powers. While some provisions of that agreement were meant to address the issues, the pandemic and China’s failure to meet its commitments—such as promises to buy more American products—left many of the core disputes unresolved.
Now, as the two nations continue to grapple with their trade issues, the conversation in Geneva remains focused on the tariffs and the impact they have on both sides. Sun Yun, director of the China program at the Stimson Center, noted the skepticism surrounding the potential for a breakthrough. She speculated that any real progress would come from mutual de-escalation of tariffs, signaling a positive but cautious step forward. But she cautioned that the effectiveness of such a move would not just be in the gesture but in actual implementation and follow-through.
As the talks continue, it is clear that tariffs are not just a matter of economic policy; they are a geopolitical battleground, with much at stake. The U.S. tariffs imposed on China and the retaliation from Beijing have disrupted global supply chains, affected international markets, and caused significant harm to industries in both countries. The tech industry, in particular, has felt the brunt of the tariffs, with U.S. companies facing higher production costs and delays, while Chinese companies have struggled to maintain access to critical technology and equipment from American firms. The knock-on effects have rippled through the global economy, affecting everything from consumer goods to raw materials, and threatening to undo decades of progress in international trade cooperation.
With President Trump’s trade policies still fresh in the minds of global leaders, there is a heightened sense of urgency to avoid further escalation. The meeting between Bessent, Greer, and Vice Premier He Lifeng in Geneva is an attempt to break the deadlock and open the door for meaningful dialogue. However, given the history of failed negotiations, it remains unclear whether any concrete steps will be taken to resolve the underlying issues.
Meanwhile, the broader international community is closely watching the situation, especially smaller economies that are heavily reliant on trade with both the U.S. and China. The impact of these tariffs extends beyond the two largest economies, affecting countries across the globe that rely on trade with both nations. Europe, in particular, has been wary of the impact of the trade war, as many of its industries have deep ties with China, while its markets remain closely tied to the U.S. As the U.S. seeks to renegotiate trade deals and reconsider its global position, the ramifications of this tension will affect industries, governments, and populations far beyond Beijing and Washington.
In the midst of these trade negotiations, Switzerland, another key global player, has found itself caught between the U.S. and Europe. As trade tensions between the U.S. and China continue to mount, Switzerland, known for its neutrality and open trade policies, faces its own set of challenges. While Swiss President Karin Keller-Sutter has downplayed the likelihood of immediate countermeasures, the government has been cautious about the effects of increased tariffs on key industries like watches, coffee capsules, cheese, and chocolate. For a country that relies heavily on trade, the imposition of tariffs could severely impact its economic performance and market stability.
Switzerland’s situation reflects a larger concern: as the world’s most powerful economies—like the U.S. and China—clash over trade policies, smaller nations are left scrambling to protect their interests and navigate the complicated web of tariffs, trade agreements, and international law. With many industries relying on the smooth flow of goods and services between major economies, the increasing uncertainty brought about by these trade conflicts is becoming increasingly untenable.
Looking forward, the key issue remains the question of whether the U.S. and China will be able to find common ground on tariffs, and whether both sides are willing to make significant concessions to bring an end to the trade war. While the Geneva talks might offer a glimmer of hope, the road to a resolution remains uncertain. With each new round of tariffs, the global economy feels the weight of these decisions. The stakes are high, and the global community is anxiously awaiting any signs of de-escalation that could pave the way for more stable and cooperative international trade relations.
As both sides move forward in their negotiations, it is clear that the outcome will have far-reaching consequences, not only for the U.S. and China but for the entire world. The hope is that the talks in Geneva will serve as the first step toward a more peaceful and cooperative global trading environment—one in which the global community can move beyond tariffs and towards a future of shared prosperity.
