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Stock markets traded mixed on Friday despite comments by US President Donald Trump suggesting he could lower tariffs on China that raised hopes weekend talks between the superpowers could lead to a de-escalation in their trade war.Wall Street’s main indices opened higher after Trump signalled that China tariffs could be lowered from 145 percent to 80 percent.But they failed to hold onto the gains in morning trading and slipped into the red following comments by US Federal Reserve policymakers that the US economy faced higher inflation and slower growth.Trump’s comments came a day after the United States and Britain announced the first agreement since the US President launched his tariffs blitz last month.”Coming hot on the heels of yesterday’s UK-US trade deal, there is an air of optimism that we could see additional deals come to fruition around the globe,” said Joshua Mahony, chief market analyst at Scope Markets.Frankfurt’s DAX rose 0.6 percent, hitting a fresh high of 23,543.27 points, recouping losses spurred by Trump’s April tariffs announcements.Paris and London also climbed following a mixed showing in Asia.Tokyo and Hong Kong closed higher but Shanghai dropped as data showed China’s exports to the United States plunged by around one fifth on-year in April as Trump’s tariffs kicked in.Oil prices jumped on hopes that easing tensions between the United States and China would alleviate fears of a slump in crude demand.The dollar dropped after rallying on news of the US-UK trade deal.The return of some confidence to the market boosted bitcoin, which topped $100,000 for the first time since February.In the first trade deal since Trump’s blitz of sweeping global tariffs, Washington agreed to lower levies on British cars and lift them entirely on steel and aluminium. In return, Britain will open up markets to US beef and other farm products, but a 10-percent baseline levy on British goods remained intact.”With the UK having basked in trade deal glory yesterday, the spotlight has now turned to China,” said Russ Mould, investment director at AJ Bell.US Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer are set to meet Chinese Vice Premier He Lifeng in Switzerland this weekend — their first formal talks since Trump raised tariffs on Chinese imports to 145 percent.Trump told reporters he thought the talks would be “substantive” and when asked if reducing the levies was a possibility, he said “it could be”.Trump later posted that “80% Tariff on China seems right!” That could see Beijing dial back some of its own 125 percent tariffs on US goods.”China is America’s biggest rival in the trade war and any sign of a compromise in their tit-for-tat tariff spat could be taken positively by markets,” Mould added. US Commerce Secretary Howard Lutnick warned that agreements with Japan and South Korea could take longer to reach, and that there was “a lot of work” in striking a deal with India.In company news, shares in Commerzbank rose 3.8 percent after the German lender reported its best quarterly profit since 2011. British airways owner IAG climbed 2.4 percent in London after it unveiled a big order for Boeing and Airbus jets and expressed optimism for air travel demand. – Key figures at around 1530 GMT -New York – Dow: DOWN 0.2 percent at 41,267.90 pointsNew York – S&P 500: DOWN less than 0.1 percent at 5,659.04New York – Nasdaq Composite: DOWN less than 0.1 percent at 17,913.85Frankfurt – DAX: UP 0.6 percent at 23,499.32 (close)London – FTSE 100: UP 0.3 percent at 8,554.80 (close) Paris – CAC 40: UP 0.6 percent at 7,743.75 (close)Tokyo – Nikkei 225: UP 1.6 percent at 37,503.33 (close)Hong Kong – Hang Seng Index: UP 0.4 percent at 22,867.74 (close)Shanghai – Composite: DOWN 0.3 percent at 3,342.00 (close)Euro/dollar: UP at $1.1263 from $1.1230 on ThursdayPound/dollar: UP at $1.3297 from $1.3249Dollar/yen: DOWN at 145.13 yen from 145.82 yenEuro/pound: DOWN at 84.70 from 84.73 penceBrent North Sea Crude: UP 1.1 percent at $63.51 per barrelWest Texas Intermediate: UP 1.1 percent at $60.59 per barrel burs-rl/jj

US President Donald Trump signaled on Friday that he could lower tariffs on Chinese imports, as the rival superpowers prepare for trade talks over the weekend.”80% Tariff on China seems right!” Trump wrote on his Truth Social platform, which would bring them down from 145 percent, with cumulative duties on some goods reaching a staggering 245 percent.He added that it was “Up to Scott B.”, referring to US Treasury Secretary Scott Bessent, who will confer with China’s Vice Premier He Lifeng this weekend in Geneva to try to cool the conflict roiling international markets.In his post Trump did not say if he thought 80 percent should be the final, definitive level for tariffs on Chinese goods if and when the trade war ends, or an interim status.In retaliation China has slapped 125 percent levies on US goods.In another post, this time all in capital letters, Trump said “China should open up its market to USA — would be so good for them!!! Closed markets don’t work anymore!!!”Chinese official data on Friday showed that the country’s global exports rose in April despite the trade war.Experts said that the forecast-smashing 8.1-percent rise indicated that Beijing was re-routing trade to Southeast Asia to mitigate US tariffs while exports to the United States fell 17.6 percent.”The global supply chain is being rerouted in real time,” Stephen Innes of SPI Asset Management wrote in a note.”The manufacturing juggernaut is diverting flow wherever the tariff pain isn’t,” he said.China has insisted its position that the United States must lift tariffs first remains “unchanged” and vowed to defend its interests.Bessent has said the meetings in Switzerland would focus on “de-escalation” — and not a “big trade deal”.Trump told reporters Thursday that he thought the Geneva talks would be “substantive” and when asked if reducing the levies was a possibility, he said “it could be”.- Markets up -Trump’s Truth Social post came a day after he unveiled what he called a historic trade agreement with Britain, the first deal with any country since he unleashed a blitz of sweeping global tariffs last month.Trump said the British deal would be the first of many, and that he hoped difficult talks with the EU — as well as China — could soon produce results too.Several countries have lined up to hold talks with Washington to avert the worst of Trump’s duties, which range from 10 percent for many countries to the sky high ones on China — Trump’s main target.Major stock markets mostly rose Friday on growing optimism that tariff tensions will ease.US futures were up while European markets were all in the green after a mixed showing in Asia.The Frankfurt DAX index hit a record high before Trump’s social media post, recouping losses spurred by the US president’s April tariffs announcements.In the first trade deal since Trump’s blitz of sweeping global tariffs, Washington agreed to lower levies on British cars and lift them entirely on steel and aluminium. In return, Britain will open up markets to US beef and other farm products, but a 10 percent baseline levy on British goods remained intact.

Major stock markets mostly rose Friday, with Frankfurt’s DAX hitting a record high, on growing optimism that tariff tensions will ease.Britain and the United States reached a deal on trade on Thursday and President Donald Trump hinted that an easing of tariffs on China was possible as officials prepare for high-stakes talks this weekend.”Coming hot on the heels of yesterday’s UK-US trade deal, there is an air of optimism that we could see additional deals come to fruition around the globe,” said Joshua Mahony, chief market analyst at Scope Markets. Frankfurt’s DAX was up 0.6 percent in midday trading, after hitting a fresh high of 23,528.88 points, recouping losses spurred by Trump’s April tariffs announcements.Paris and London also climbed following a mixed showing in Asia and gains Thursday on Wall Street.Tokyo and Hong Kong closed higher but Shanghai dropped as data showed China’s exports to the United States plunged by around one fifth on-year in April as Trump’s tariffs kicked in.Oil prices jumped on hopes that easing tensions between the United States and China would alleviate fears of a slump in crude demand.The dollar dropped after rallying on news of the US-UK trade deal.The return of some confidence to the market boosted bitcoin, which topped $100,000 for the first time since February. In the first trade deal since Trump’s blitz of sweeping global tariffs, Washington agreed to lower levies on British cars and lift them entirely on steel and aluminium. In return, Britain will open up markets to US beef and other farm products, but a 10 percent baseline levy on British goods remained intact.”With the UK having basked in trade deal glory yesterday, the spotlight has now turned to China,” said Russ Mould, investment director at AJ Bell.US Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer are set to meet Chinese Vice Premier He Lifeng in Switzerland this weekend — their first formal talks since Trump raised tariffs on Chinese imports to 145 percent.Trump told reporters that he thought the talks would be “substantive” and when asked if reducing the levies was a possibility, he said “it could be”.That could see Beijing dial back some of its own 125 percent tariffs on US goods.”China is America’s biggest rival in the trade war and any sign of a compromise in their tit-for-tat tariff spat could be taken positively by markets,” Mould added. US Commerce Secretary Howard Lutnick warned agreements with Japan and South Korea could take longer to reach, while adding that there was “a lot of work” in striking a deal with India.Trump also flagged efforts at home to push through the tax cuts he promised during the election campaign.In company news, shares in Commerzbank rose more than two percent after the German lender reported its best quarterly profit since 2011. British airways owner IAG climbed two percent in London after it unveiled a big order for Boeing and Airbus jets and expressed optimism for air travel demand. – Key figures at around 1030 GMT -Frankfurt – DAX: UP 0.6 percent at 23,499.44 pointsLondon – FTSE 100: UP 0.5 percent at 8,577.06 Paris – CAC 40: UP 0.8 percent at 7,753.91Tokyo – Nikkei 225: UP 1.6 percent at 37,503.33 (close)Hong Kong – Hang Seng Index: UP 0.4 percent at 22,867.74 (close)Shanghai – Composite: DOWN 0.3 percent at 3,342.00 (close)New York – Dow: UP 0.6 percent at 41,368.45 (close)Euro/dollar: UP at $1.1246 from $1.1230 on ThursdayPound/dollar: UP at $1.3272 from $1.3249Dollar/yen: DOWN at 145.33 yen from 145.82 yenEuro/pound: DOWN at 84.70 pence from 84.73 penceBrent North Sea Crude: UP 1.8 percent at $63.97 per barrelWest Texas Intermediate: UP 1.9 percent at $61.07 per barrel 

Chinese exports rose last month despite the trade war raging with the United States, official data showed Friday ahead of talks between the world’s top two economies towards easing the standoff.Experts said that the forecast-smashing 8.1-percent rise indicated that Beijing was re-routing trade to Southeast Asia to mitigate US tariffs of up to 145 percent on Chinese imports imposed by President Donald Trump.Trade between the world’s two largest economies has slumped since Trump imposed the tariffs — some cumulative duties are 245 percent — and China responded with levies of 125 percent and other measures.The year-on-year increase in exports of 8.1 percent in April was much higher than the 2.0 percent forecast by analysts polled by Bloomberg last month.The data from the Chinese customs bureau showed exports to Thailand, Indonesia and Vietnam surged by double digits, in what one analyst called a “structural repositioning” of trade.”The global supply chain is being rerouted in real time,” Stephen Innes of SPI Asset Management wrote in a note.”Vietnam looks set to become China’s offshore escape hatch for US-facing goods,” he said.”The manufacturing juggernaut is diverting flow wherever the tariff pain isn’t.”Month-on-month exports to the United States plunged 17.6 percent.Analysts at ANZ Research said the data revealed “it is difficult to exclude China from the global supply chain in the short term, considering China’s role in manufacturing.””The implied supply chain realignment as well as the expected outcome of Asia-US trade talks suggests no imminent collapse in China exports,” they added.Global markets have been on a rollercoaster since Trump began his tariff offensive aimed according to the White House at bringing back manufacturing to the United States.While Trump has suspended for 90 days many of the most painful levies, those on China have remained in place.Markets have been lifted by optimism over meetings set to take place in Geneva over the weekend between US and Chinese officials — the first talks between the superpowers since Trump’s trade offensive began.Washington has said it hopes the sitdown will allow for a “de-escalation”, while Beijing has vowed it will stand its ground and defend its interests.- ‘Persisting uncertainties’ -Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, also attributed the forecast-beating exports to “transshipment through other countries.”But he also cited potential “trade contracts that were signed before the tariffs were announced.””I expect trade data will weaken in the next few months.”Imports were also being closely watched as a key gauge of consumer demand in China, which has remained sluggish.They also beat expectations, dropping 0.2 percent, compared with the 6.0-percent slide analysts had estimated.Chinese policymakers this week eased key monetary policy tools in a bid to ramp up domestic activity.Those included cuts to a key interest rate and moves to lower the amount banks must hold in reserve in a bid to boost lending.A persistent crisis in the Chinese property sector — once a key driver of growth — also remains a drag on the economy.In an effort to help the sector, Beijing’s central bank chief said it would cut the rate for first-time home purchases with loan terms over five years to 2.6 percent, from 2.85 percent.The moves represent some of China’s most sweeping steps to boost the economy since September.But analysts pointed to a continued lack of actual stimulus funds needed to get the economy back on track — a task further complicated by trade headwinds with Washington.”Even if the tariffs may be trimmed depending on the outcome of US-China trade talks, the persisting uncertainties will continue to accelerate decoupling structurally,” Gary Ng, senior economist for Asia Pacific at Natixis, told AFP.

Japanese electronics giant Panasonic, which supplies batteries to Tesla, said Friday it will target 10,000 job cuts worldwide as part of efforts to boost profitability.The cuts, which represent around four percent of the group’s workforce of nearly 230,000, will be implemented mainly in the current financial year to March, it said.Panasonic said it would “thoroughly review operational efficiency at each group company, mainly in sales and indirect departments”.It will “reevaluate the numbers of organisations and personnel actually needed”, a statement said.”This measure targets 10,000 employees (5,000 in Japan and 5,000 overseas) at consolidated companies,” and will be executed “in accordance with the labour laws, rules, and regulations of each country and region”.Panasonic became a global household name in the latter half of the 20th century, pioneering electronic appliances from rice cookers to televisions to video recorders.The Osaka-based conglomerate is a major battery supplier for Elon Musk’s US electric vehicle maker Tesla, and also operates in the housing, energy and auto sectors.Panasonic in February outlined a management reform programme to resolve “various structural issues” at the company.”Through the current management reform, the company aims to improve profit by at least 150 billion yen ($1 billion),” it said Friday.In its full-year earnings report, also released Friday, Panasonic forecast a 15 percent decline in net profit this year, and an eight percent slump in sales.In the financial year to March 31, 2025, the group logged a 17.5 percent decline in net profit to 366 billion yen.Panasonic is facing “ongoing business environment changes (such as) a slowdown in demand for EVs”, it said.As for US trade tariffs, “their impact is not factored into this forecast”, Panasonic added.”The company continues to monitor the tariff situation and aims to minimize the resulting impact by taking measures from both short-term and medium- to long-term perspectives.”In an interview published in April, Panasonic Holdings CEO Yuki Kusumi told Japan’s Nikkei newspaper that personnel cuts would be necessary, without detailing their scale.Job cuts would be needed “in order for us to perform at a competitive level against other firms”, he told the Nikkei.In Panasonic’s history, the group has also gradually expanded its headcount during profitable periods, Kusumi stressed.

Most equities rose Friday on growing optimism that the worst of Donald Trump’s trade war is past after he reached a deal with Britain and suggested he could lower tariffs on China as officials prepare for high-stakes talks this weekend.The mood among investors has improved substantially since the US president unveiled his “Liberation Day” blitz last month, sending markets spinning and fuelling global recession fears.Several countries have lined up to hold talks with Washington to avert the worst of the duties that range from 10 percent to as high as 145 percent on China — Trump’s main target.On Thursday, Britain became the first to announce a deal that reduces tariffs on British cars and lifts them on steel and aluminium, while in return Britain will open up markets to US beef and other farm products.While there are several areas that still need discussing, Trump and Prime Minister Keir Starmer hailed the “historic” deal, with the US president saying it should be seen as a template for others.The “news gives hope that similar deals will be reached with a range of countries, thereby reducing the long-term damage potentially wrought by tariffs”, said Invesco’s David Chao.But analysts said traders were more excited about the Republican leader’s comments on the upcoming talks with China in which he hinted at an easing of the stiff measures aimed at the world’s number two economy. That could see Beijing dial back some of its own 125 percent tariffs on US goods.Trump told reporters that he thought the negotiations would be “substantive” and when asked if reducing the levies was a possibility, he said “it could be”.”We’re going to see. Right now you can’t get any higher. It’s at 145 percent so we know it’s coming down. I think we’re going to have a very good relationship.” Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer are set to meet Chinese Vice Premier He Lifeng in Switzerland on Saturday and Sunday, the first talks between the superpowers since Trump unveiled his tariffs.The US president also flagged efforts at home to push through the tax cuts he promised during the election campaign, adding: “This country will hit a point that you better go out and buy stock.”Now, let me tell you this, this country will be like a rocket ship that goes straight up.”Stephen Innes, of SPI Asset Management, said: “As important as the UK deal was, Trump’s tone on China was the real signal for markets — and it handed the risk-on baton straight to Asia in a friendly, optimistic fashion. “The president all but greenlit the idea that the days of punitive standoff might give way to negotiated momentum.”Asian markets extended the week’s rally and tracked gains on Wall Street.Tokyo jumped more than one percent on hopes for Japan’s trade talks. However, Commerce Secretary Howard Lutnick warned agreements with Japan and South Korea could take longer to reach, while adding that there was “a lot of work” in striking a deal with India. Seoul edged down with Mumbai and Bangkok.But Hong Kong, Sydney, Wellington, Taipei, Manila and Jakarta all advanced with London, Paris and Frankfurt.Shanghai dropped as data showed exports to the United States plunged by around a fifth on-year in April as Trump’s tariffs kicked in.However, there was some cheer from other figures that showed total shipments rose far more than expected. Imports also fell far less than forecast.The return of some confidence to the market also helped bitcoin recover, pushing it back above $100,000 for the first time since February. The cryptocurrency struck $104,159 on Thursday, pushing it towards the record above $109,000 seen in January.- Key figures at around 0810 GMT -Tokyo – Nikkei 225: UP 1.6 percent at 37,503.33 (close)Hong Kong – Hang Seng Index: UP 0.4 percent at 22,867.74 (close)Shanghai – Composite: DOWN 0.3 percent at 3,342.00 (close)London – FTSE 100: UP 0.6 percent at 8,578.56 Euro/dollar: UP at $1.1252 from $1.1230 on ThursdayPound/dollar: UP at $1.3263 from $1.3249Dollar/yen: DOWN at 145.12 yen from 145.82 yenEuro/pound: UP at 84.83 pence from 84.73 penceWest Texas Intermediate: UP 1.2 percent at $60.63 per barrel Brent North Sea Crude: UP 1.1 percent at $63.55 per barrelNew York – Dow: UP 0.6 percent at 41,368.45 (close)

China said Friday sales to the United States slumped last month while its total exports topped forecasts, as Beijing fought a gruelling trade war with its superpower rival.Trade between the world’s two largest economies has nearly skidded to a halt since US President Donald Trump imposed various rounds of levies on China that began as retaliation for Beijing’s alleged role in a devastating fentanyl crisis.Tariffs on many Chinese products now reach as high as 145 percent — with cumulative duties on some goods soaring to a staggering 245 percent.Beijing has responded with 125 percent tariffs on imports of US goods, along with other measures targeting American firms.Against that backdrop, analysts polled by Bloomberg had expected exports to rise just 2.0 percent year-on-year last month.But they beat expectations, coming in at 8.1 percent.However, exports to the United States — one of China’s top trading partners — fell 17.6 percent month-on-month, data showed.”The damage of the US tariffs has not shown up in the trade data in April,” Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said in a note.”This may be partly due to transshipment through other countries, and partly because of trade contracts that were signed before the tariffs were announced,” he added.”I expect trade data will weaken in the next few months gradually.”US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are set to meet Chinese Vice Premier He Lifeng in Switzerland on Saturday and Sunday, marking the first talks between the superpowers since Trump unveiled his tariffs.April imports also beat expectations, dropping 0.2 percent, compared with the 6.0 percent slide analysts had estimated.Purchases from overseas were also being closely watched as a key gauge of consumer demand in China, which has remained sluggish.Policymakers this week eased key monetary policy tools in a bid to ramp up domestic activity.Those included cuts to a key interest rate and moves to lower the amount banks must hold in reserve in a bid to boost lending.A persistent crisis in the property sector — once a key driver of growth — also remains a drag on the economy.In an effort to help the sector, Pan also said the bank would cut the rate for first-time home purchases with loan terms over five years to 2.6 percent, from 2.85 percent.The moves represent some of China’s most sweeping steps to boost the economy since September.But analysts pointed to a continued lack of actual stimulus funds needed to get the economy back on track.

A formidable set of cards that includes granting access to its vast market and an ability to withstand economic pain will allow Beijing to play hardball in upcoming trade talks with the United States in Geneva, analysts say.Trade between the world’s two largest economies has nearly skidded to a halt since US President Donald Trump slapped China with various rounds of levies that began as retaliation for Beijing’s alleged role in a devastating fentanyl crisis.With additional measures justified by Trump as efforts to rebalance the trade relationship and prevent the United States from being “ripped off”, tariffs on many Chinese products now reach as high as 145 percent — with cumulative duties on some goods soaring to a staggering 245 percent.Beijing has responded with 125 percent tariffs on US imports, along with other measures targeting American firms.But after weeks of tit-for-tat escalation that sent global markets into a tailspin, the two powers will meet this weekend for a chance to break the ice.Washington has said it’s not expecting a “big trade deal” that could address Trump’s longstanding complaint about the major goods imbalance with the export powerhouse — but it is hoping the two sides can at least begin to de-escalate tensions.Beijing has vowed to stick to its guns and insisted its demand that all US tariffs be lifted remains “unchanged”.Analysts say, however, China is in no major rush to make a deal.”Beijing can impose some pain on the United States,” Chong Ja Ian, associate professor of political science at National University of Singapore, told AFP.China’s core strengths going into the talks are its huge domestic market, as well as “key technologies and control of a significant proportion of processed rare earth minerals”, Chong said.- ‘No wild bluster’ – Compared to its approach during Trump’s first term, Beijing’s response to his tariffs this time has been “more mature”, said Dylan Loh, an assistant professor at Singapore’s Nanyang Technological University.”There’s no wild bluster,” he explained.”I think they have learnt from their earlier responses and they know that they cannot be led by the nose,” he said.Analysts say China has been able to take more of a hardline posture to Trump’s tariffs this time, despite its struggling economy.”It still has meaningful retaliatory tools and — just as important — staying power,” said Lizzi Lee from the Asia Society Policy Institute’s Center for China Analysis.China’s autocratic system, she said, allowed it “to absorb economic pain in ways democracies often cannot”.Beijing has also concurrently launched a charm offensive aimed at tightening trade ties in Southeast Asia and Europe — positioning itself as a more stable and reliable partner in contrast to the mercurial Trump administration.That move allowed Beijing to “build buffers” against trade war vicissitudes, Lee said.”It won’t replace the US market overnight, but every incremental diversification reduces exposure and increases negotiating room,” she added.That’s not to say China isn’t hurting.Sales of Chinese goods to the US last year totalled more than $500 billion — 16.4 percent of the country’s exports, according to Beijing’s customs data.But as the effects of the trade war sunk in, China’s factory activity shrank in April, with Beijing blaming a “sharp shift” in the global economy.While not as colossal as China’s export levels, US shipments to the country last year were a considerable $143.5 billion, according to the US Trade Representative website.”Even in the case that one of the two countries would clearly have ‘the upper hand’, it is still worse off economically than before the trade war started,” said Teeuwe Mevissen, senior China economist at Rabobank.Beijing and Washington have “found out that it is not so easy to fully decouple”.- Talks about talks -Policymakers this week unveiled measures to boost domestic consumption — a sign that leaders are “not panicking but feeling some pressure”, said Shehzad Qazi, managing director of China Beige Book.Beijing will need to strap in for potentially long and drawn-out negotiations with Washington that could bring “much more volatility along the way”, said Qazi. Analysts broadly agree that upcoming talks are a first step towards a de-escalation of tensions that could, a long way down the line, lead to a lifting of tariffs.”A best-case scenario would be agreement around a process to enter future negotiations,” Ryan Hass, senior fellow at Brookings Institution, told AFP.Beijing could insist on receiving the same 90-day waiver on tariffs that other countries had received, he suggested.And China’s insistence that the Switzerland talks came at the request of Washington suggests it is the United States that is desperate for a deal, said Dan Wang, China Director at the Eurasia Group.”The fact that it is happening is showing some concessions already on the US side.”

US and Chinese officials meet this weekend in Geneva for their first formal talks aimed at resolving a gruelling tit-for-tat tariff war that threatens hundreds of billions in trade and roiled global markets and supply chains.AFP looks at how the trade row between the world’s two economic superpowers is playing out:- What steps have the two sides taken so far? -The United States has raised tariffs on Chinese imports to 145 percent, with cumulative duties on some goods reaching a staggering 245 percent.As well as the blanket levies, China has also been hit with sector-specific tariffs on steel, aluminium and car imports.Sales of Chinese goods to the United States last year totalled more than $500 billion — 16.4 percent of the country’s exports, according to Beijing’s customs data.Beijing has vowed to fight the measures “to the end” and has unveiled reciprocal tariffs of up to 125 percent on imports of American goods, which totalled $143.5 billion last year, according to Washington.China has filed complaints with the World Trade Organization (WTO), citing “bullying” tactics by the Trump administration.And it has gone after US companies, scrapping orders for Boeing planes, probing Google for “anti-monopoly” violations and adding fashion group PVH Corp. — which owns Tommy Hilfiger and Calvin Klein — and biotech giant Illumina to a list of “unreliable entities”.Beijing has also restricted exports of rare earth elements — critical for making a wide range of products including semiconductors, medical technology and consumer electronics.- What’s been the impact? – Beijing has long drawn Trump’s ire with a trade surplus with the United States that reached $295.4 billion last year, according to the US Commerce Department’s Bureau of Economic Analysis. Chinese leaders have been reluctant to disrupt that status quo.But an intensified trade war could mean China cannot peg its hopes for strong economic growth this year on exports, which hit a record high in 2024.US duties further threaten to harm China’s fragile post-Covid economic recovery as it struggles with a debt crisis in the property sector and persistently low consumption.The tariff war is already having an impact in the United States, with uncertainty triggering a manufacturing slump last month and officials blaming it for an unexpected economic contraction during the first three months of the year.”Both countries have surely found out that it is not so easy to fully decouple,” Teeuwe Mevissen, senior China economist at Rabobank, told AFP.”Both the US and China lose economically with the current trade war,” he said, adding that even in the case that one side gains the upper hand “it is still worse off economically than before the trade war started”.The head of the WTO warned in April that the US-China standoff could cut trade in goods between the two countries by 80 percent.Beijing announced a raft of interest rate cuts on Wednesday aimed at boosting consumption — a possible sign that it is starting to feel the pinch.Analysts expect the levies to take a significant chunk out of China’s gross domestic product, which Beijing’s leadership have targeted to grow five percent this year.Likely to be hit hardest are China’s top exports to the United States — this includes everything from electronics and machinery to textiles and clothing.And because of the crucial role Chinese goods play in supplying US firms, the tariffs may also hurt American manufacturers and consumers, analysts have warned.- Is a breakthrough possible? -Both sides insist that economic pressures have driven the other to seek negotiations.But while markets have welcomed the talks, a major breakthrough in Geneva seems unlikely.China has insisted its position that the United States must lift tariffs first remains “unchanged” and vowed to defend its interests.US Treasury Secretary Scott Bessent has said the meetings will focus on “de-escalation” — and not a “big trade deal”.But analysts do expect some form of tariff reduction to be announced following Saturday’s ice-breaking exercise.”One possible outcome of the Switzerland talks is an agreement to pause most, if not all, of the tariffs that have been imposed this year while negotiations take place,” Bonnie Glaser, managing director of the German Marshall Fund’s Indo-Pacific program, told AFP.Lizzi Lee from the Asia Society said she expected “a tentative, symbolic gesture — designed to lower temperatures, not resolve core disputes”.”Stabilisation and guardrails are the most likely outcomes.”

Surrounded by samples of silk and glittering tweed in one of China’s largest fabric markets, textiles exporter Cherry said she was anxiously awaiting the result of trade talks with the United States this weekend.Her company, which relies on US customers for around half its client base, is one of many caught in the crosshairs as the standoff between Washington and Beijing has escalated this year. Cherry has already had US orders cancelled, and is desperately hoping the negotiations starting Saturday in Geneva will result in the rolling back of the reciprocal tariffs that make doing business almost impossible.”The situation will be very bad if this continues,” she said, sceptical of claims her industry would be able to weather prolonged levies.”A few months ago I heard people say they’d had many containers (of goods) being cancelled… Some factories have already had to stop production.” Sales to the United States made up 18 percent of China’s total textiles and apparel exports in 2024, according to Moody’s Ratings. A significant proportion of that comes from the eastern manufacturing powerhouse province of Zhejiang, where the labyrinth-like Keqiao China Textile City is based in the city of Shaoxing. With a listed 26,000 shops selling everything from velvet to rayon to fake fur, it is touted as one of the world’s busiest fabric hubs. But customers were few and far between when AFP visited on a day of torrential rain this week, with vendors’ spirits largely dampened too.  “Of course I am afraid,” said one woman surnamed Li, who added that business was already affected by the global turmoil.  “This is my job — I rely on it to support my family… I hope for a good outcome (for the talks).”- ‘Lose-lose scenario’ -The Geneva talks are the first official public engagement between the two sides aimed at resolving the stand-off triggered by US President Donald Trump’s wide-ranging tariffs. The subsequent tit-for-tat means many Chinese goods entering the United States now face duties of 145 percent — with some specific sectors even higher — while Beijing has hit back with 125 percent levies on most US goods.   One seller in Keqiao market described the situation as a “lose-lose scenario”.  Some of her colleagues’ US customers have agreed to pay a 30 percent non-refundable deposit to initiate production, on the understanding that the whole order can be cancelled if the final tariff level after negotiations is still too high. If that happens, everyone will lose money. “We basically don’t dare to take US orders anymore,” said 66-year-old Zhou, standing in front of swaths of khaki in various hues. “The cost price can’t even be covered, especially with such high tariffs added on.”For companies like his daughter’s, which dealt mainly with US clients, “the impact is huge”, he said. “The best outcome would be for everyone to sit down and talk things through — it would be good for everyone, right?” Even the hint of de-escalation has brought some back to the table, with one exporter telling AFP a client who had suspended orders had recently given the go-ahead for production to begin.But at a ski suit workshop in a cross-border e-commerce centre a few kilometres away, 31-year-old Xiao Huilan said a lot of local companies had lost out completing production for orders that had subsequently been reduced or held off. “In the short term, we can manage, but in the long run, businesses can’t sustain it,” she said. “In a trade war, no one really wins. What we hope for is reconciliation, where everyone can coexist and prosper together.”