US mixed signals on China trade will cause private sector paralysis

THE Trump administration’s recent attempts to de-escalate trade tensions with China demonstrate a fraught balancing act between projecting strength and preventing economic damage. After President Trump announced a dramatic 100 per cent tariff on Chinese goods just days ago, Treasury Secretary Scott Bessent now claims the two nations have “substantially de-escalated”, highlighting the administration’s volatile approach to one of America’s most consequential bilateral relationships.

The current situation follows a familiar pattern. On Oct 10, President Trump announced sweeping new tariffs – set to take effect Nov 1 – following Chinese export restrictions that disrupted ongoing negotiations. Within days, however, his administration began signalling openness to dialogue. Bessent emphasised that “the 100 per cent tariff does not have to happen”, suggesting the threat itself was the policy tool rather than an inevitable outcome.

This whiplash approach raises fundamental questions about strategic coherence. Is the administration employing calculated brinkmanship to extract concessions, or does the rapid cycling between threats and reconciliation signal internal disagreement and market pressure forcing course corrections? The answer likely involves both, but the execution leaves allies, adversaries, and markets perpetually guessing at American intentions.