Henry Huiyao Wang on China-U.S. Trade Talk

And you read about the possible talk here first, on April 30.

On April 30, I was the first to declare, in ALL CAPS: CHINA APPEARS READY FOR TRADE TALKS WITH U.S.

The Pekingnology piece was immediately followed by reports in the Financial Times and the Washington Post, with quotes from yours truly in both.

Washington Post: China signals, ever so obliquely, that it’s more open to trade talks

“China appears ready to engage with the U.S. on talks or negotiations,” said Zichen Wang, author of the Pekingnology newsletter and research fellow at the Center for China and Globalization, a Beijing think tank.

The similar and simultaneous messages come from two blogs — the other run by Ren Yi, a politically well-connected writer who uses the moniker “Chairman Rabbit” — that “have a record of conveying messages out of Beijing,” he said.

Financial Times: China signals opening for trade talks with US
Zichen Wang, author of the Pekingnology newsletter and research fellow at the Center for China and Globalization think-tank in Beijing, said the posts from Yuyuan Tantian and another social media account indicated China appeared ready for trade talks.

“This signalling method through social media accounts remains relatively novel in the Chinese context,” he said, though Wang noted Beijing had also used a social media account for signalling purposes during the first trade war with the US.

Wang added that the US “must demonstrate respect, refrain from hostile rhetoric and exhibit genuine sincerity” for any meaningful progress to occur.

After a five-day national holiday, Beijing announced on May 7 that Vice Premier He Lifeng will travel to Switzerland, where he will meet with U.S. Treasury Secretary Scott Bessent.

— Zichen

Following the formal announcement, Henry Huiyao Wang, President of the Center for China & Globalization (CCG), joined Bloomberg Televisions’s The China Show live to discuss the development. He was interviewed by hosts David Ingles and Yvonne Man.

Below is the transcript of the conversation. The video footage is at the end of the blogpost.

David Ingles

At this point, let's bring in Henry Huiyao Wang, Founder and President at a Beijing-based think tank, the Center for China and Globalization. Henry, good morning from Hong Kong, and thanks for taking the time to speak with us--I imagine fairly last minute for you--so we appreciate that.

Henry Huiyao Wang

Thank you.

David Ingles

The first set of official trade talks at a very high level are taking place this weekend. What expectations do you have?

Henry Huiyao Wang

Well, after so many escalations and pressures and also the running wild of speculations, finally, both sides have agreed to meet in Geneva. As you said, David, this is really high level. Vice Premier He Lifeng is on top of those issues. He has constantly met other senior people from the U.S. For example, he met Henry Paulson in March. He met John Thornton, Chair Emeritus of Brookings and Co-Chair of Asia Society, in April after the war took off. He also met businessmen like Ray Dalio, Nvidia CEO Jensen Huang, and many others. So he’s on top of these issues. The U.S. has, over a dozen times, said that they want to talk with China. Finally, China agrees to that. This will be a good start. Even though it’s late, at least they start talking, start exchanging. Once you have face-to-face meetings, that makes a lot of difference. Then you can hear directly, truthfully, and frankly each other’s opinions. That’s better than being hijacked by social media, by speculation, or by different narratives. This is really straight talk. Hopefully, we will achieve something in the end.

Yvonne Man

Henry, it seems at least the U.S. has dialled back the expectations of any sort of big trade deal—that maybe this could be just a de-escalation. What (does) a de-escalation look like in your eyes? Is it a tariff suspension—something that’s likely? And how much could we see, possibly?

Henry Huiyao Wang

Well, I think there’s quite a number of ways to do that. First of all, deescalation—I mean, President Trump already has done some of that. For example, he relaxed tariffs on those iPads and iPhones and computers. Remember, 80% of Apple phones were made in China, and also 70% of PCs were made in China, and half of Tesla’s EV cars were made in China. So President Trump already exempted the $100 billion on those goods out of China for those high-tech companies. U.S. companies made a huge part of this export business of China. When the top leader met business CEOs earlier this year, he was saying that one third of China’s exports were done by multinationals. So they’re going to hurt those multinationals. Walmart used to purchase 80% of supplies from China. Now they still have 60%. And recently, Walmart is saying, let’s continue to purchase from suppliers from China. So I think that one area which is multinational-driven is demanding.

Second, I think fentanyl is another issue. President Trump added the 20% totally on fentanyl, which is not really reasonable. I think we’ve seen the Assistant Deputy Secretary of the State Department of the Biden Administration wrote an op-ed not too long ago saying that they were cooperating with China very well. Homeland Security has talked to the Chinese Ministry of Public Security. And also, China has taken a lot of actions, and the death rate from fentanyl last year, 2024, dropped 27%.

So you can see, there’s a lot of progress being made. So I’m sure this is probably a low hanging fruit. They could have more talks on that. And if the U.S. can share who are really making those fentanyls—cartels—so I think those areas can be done.

But also, there’s, I’m sure, the TikTok issue there. President Trump said they can relax on that too. So many areas. I think, of course, this has to calm down. You cannot really sustain.

David Ingles

Right. And you know, Henry, I wanted to maybe take not a full step, half a step back because, you know, one of the demands that the Chinese side have been public about is that the U.S. needs to remove the tariffs and then they'll talk. I mean, the fact that the tariffs remain in place, but we're getting these talks set to take place, do you think that precondition is still the same? Or do you think the bar has been lowered right now for progress to actually take place while tariffs remain in place?

Henry Huiyao Wang

Well, I think this—I’m sure the U.S. is going to affect their container shipping, their supermarket consumers, Christmas, Thanksgiving holidays—I mean, it’s all happening now. So what I think can be done is, let’s all reduce 70, 80 percent. Realistically, Trump added the 25 percent on EU and Canada. But let’s talk around those 25 percent. So coming down—I mean, 145 to 125—I think that 20 percent tariff based on fentanyl can be gotten rid of right away. That’s really a very low hanging fruit. China has already done a lot. It’s just that China didn’t talk much about that.

Second, on the 25 percent, let’s all come down for another 80 to 90 percent bilaterally. And then there’s the remaining 25 percent—we can talk, probably. I can see there’s many ways to handle that. Because 125 percent on both sides, it doesn’t really going to work. It means decouple. It means embargo. So it’s not going to work. And I think it’s going to hurt U.S. companies quite a lot. China probably also gets hurt too. But China can endure hardship. I mean, they’ve gone through all those hardships in old days, and they’re never afraid of going out again.

Yvonne Man

Henry, we had an economist come on just now saying when it comes to the data, they haven’t quite seen the disruptions just yet in April from any sort of tariff impact. Are you seeing anything from your end on whether supply chains have been moved around? Have we seen export volumes starting to fall from China to the U.S.? What are you seeing in terms of frequency data and the like?

Henry Huiyao Wang

Yeah, I just came back from Washington and New York, and I was attending the World Economic Summit organised by Semafor there, and 214 CEOs were there. But basically what they were talking about—the CEOs were saying—even though there’s a 90-day suspension of the tariff for many countries, which means three months of uncertainty and three months of not making decisions, it’s going to impact three years. So I think it’s a confidence issue. The data may not reflect it so quickly, but I’m sure it’s going to reflect in May and June. We already see some data happening already.

So I think that is certainly going to affect everybody. I see some Chinese companies already—they’re preparing to sell more domestically now. They’re also selling more to other countries. There’s a study—70 countries, if they really work on the current growth rate, they can absorb. They don’t need to sell to the U.S. anymore in one year. And 112 countries, in five years, don’t have to sell to the U.S. So companies are prepared for that.

And this is really a big disruption because they were doing fine. They were buying all the good stuff from the U.S. But now they all think twice. They are really frightened or scared by this kind of escalation—astronomical escalation—that nobody ever expected. So I think it’s high time they come back and calm down and really talk.

I’m sure, being the two largest economies, they have responsibilities not only for China and the U.S., but also for the world economy’s stability. And now we have wars going on everywhere, you can’t just have a trade war continue. That’s really not relevant.

Yvonne Man

All right, Henry, we’ll leave it there. Thank you so much, Henry Huiyao Wang, Founder and President at the Center for China and Globalization.

The footage of Henry Huiyao Wang’s appearance on Bloomberg TV