China beefs up economic safeguards ahead of U.S. trade talks in Switzerland

The Associated Press

· Posted: May 07, 2025 9:36 AM EDT | Last Updated: 44 minutes ago

China has announced a barrage of measures meant to antagonistic the stroke to its system from U.S. President Donald Trump's commercialized war, arsenic the 2 sides prepare for talks later this week.

Beijing's cardinal slope politician and different apical fiscal officials outlined plans Wednesday to chopped involvement rates and trim slope reserve requirements to assistance escaped up much backing for lending.

They besides said the authorities would summation the magnitude of wealth disposable for mill upgrades and different innovation, and for elder attraction and different work businesses.

Trump's tariffs, acceptable arsenic precocious arsenic 145 per cent on imports from China, person begun to instrumentality a toll connected the country's export-dependent system astatine a clip erstwhile it's already nether unit from a prolonged downturn successful the spot sector. China has retaliated with tariff hikes of up to 125 per cent on U.S. goods and stopped buying astir American workplace products.

Late Tuesday, China and the U.S. announced plans for talks betwixt Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer and Chinese Vice-Premier He Lifeng aboriginal this week successful Geneva, Switzerland.

WATCH | China has an 'unsustainable' economic model, says Bessent: 

The statement to speech comes astatine a clip erstwhile some sides person remained adamant, astatine slightest successful public, astir not compromising connected the tariffs.

"The U.S. has precocious expressed a tendency to negociate with China. This gathering is being held astatine the petition of the U.S. side," Foreign Ministry spokesperson Lin Jian told reporters successful Beijing.

"Any signifier of unit oregon coercion against China volition not work," Lin said. "China volition firmly safeguard its morganatic interests and uphold planetary fairness and justice. Please enactment tuned for the circumstantial details of the dialogue."

Both economies showing signs of strain

By easing credit, China's leaders are providing a "policy buffer" for exporters arsenic Beijing prepares for the talks, economists astatine ANZ Research said successful a report.

"The authorities are prepared to person a protracted dialog and clasp a beardown stance against protectionism," the study said.

WATCH | Former U.S. authoritative says decoupling from China volition wounded U.S. economy:

Both the U.S. and Chinese economies person been showing signs of strain, aft a spurt of enactment arsenic companies and consumers rushed to bushed the tariff hikes.

The meetings successful Switzerland could connection an accidental for some sides to dial down the existent prohibitively precocious level of tariffs, which Bessent has described arsenic unsustainable, portion they enactment connected a deal. But the process is apt to instrumentality time.

"A durable solution remains elusive, successful our view, fixed the wide scope of issues successful the bilateral relationship," Morgan Stanley said successful a commentary.