Donald Trump has floated the idea of cutting US trade tariffs against China to 80% – as key peace talks between the sides prepare to get under way.
The weekend meeting, involving top officials from both nations in Switzerland, is seen as an opportunity to ease the most damaging and punitive element of the trade war.
At stake for both sides is not only a deteriorating domestic outlook but a weakening global economy.
Writing on his Truth Social platform, hours after agreeing an interim deal with the UK, the president said: “80% Tariff on China seems right! Up to Scott B [Bessent].”
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It means the decision will lie with Scott Bessent – the US treasury secretary who will lead the US delegation at the talks in Geneva.
The outcome is eagerly awaited after several rounds of tariff hikes that currently total duties of 125% on US imports to China and 145% on Chinese goods arriving in America.
Both levels amount to an effective trade embargo, given the severity of the numbers. A 80% figure against China would remain hugely restrictive.
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Trump: Tariffs are making US ‘rich’
But the announcement of talks in Switzerland this week has been welcomed broadly – across financial markets too, with the dollar and global stocks rising on Friday in hopeful anticipation of a cooling in the trade hostilities between the world’s two largest economies.
Investors are not only concerned by higher, if not extortionate, prices but also the impact on supply.
The effects are being felt in both economies already.
Fears of a trade war effectively meant that the US economy contracted during the first three months of the year, while the US central bank has held off on interest rate cuts on the grounds that tariffs applied to imports by the Trump administration globally will lift inflation markedly.
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China’s Silicon Valley: ‘It’s our time to battle’
Official data out of China is yet to show any obvious pain, but surveys suggest factory orders are tumbling.
The fact that China is suffering was borne out on Wednesday when the country’s central bank cut interest rates and reduced bank reserve requirements to help free up more funding for lending.
The authorities also agreed wider borrowing facilities to help manufacturers.
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It will be hoped that bolstering activity in the economy will help lift prices generally, as China continues to battle deflation.
Officially, China has signalled that it wants the US to make the first concession.
Its delegation in Geneva is led by vice premier He Lifeng – a figure within China who has gained an international reputation as an effective negotiator.
A commerce ministry spokesperson said of the prospects for a breakthrough when confirming the talks: “The Chinese side carefully evaluated the information from the US side and decided to agree to have contact with the US side after fully considering global expectations, Chinese interests and calls from US businesses and consumers.”
White House economic adviser Kevin Hassett told Sky’s US partner CNBC on Friday: “Everything that’s been going on with the meeting in Switzerland is very promising to us.
“We’re seeing extreme respect, treating both sides with respect. We’re seeing collegiality and also sketches of positive developments.”
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Ryan S. Clark
LAS VEGAS — Just when it appeared that the Vegas Golden Knights finally found an opening in overtime, their chances of winning Game 2 were quickly shut down in controversial fashion.
It wasn’t that the Golden Knights were overlooking what it means to be in a 2-0 series hole following a 5-4 overtime loss Thursday to the Edmonton Oilers on Thursday in Game 2 of the Western Conference semifinals at T-Mobile Arena.
They were more concerned with what they saw, and what they didn’t see from referee Gord Dwyer just 17 seconds before Leon Draisaitl‘s game-winning goal gave the Oilers their first 2-0 series lead since 2017.
Vegas defenseman Brayden McNabb was going toward for the puck when Edmonton winger Viktor Arvidsson‘s stick got between McNabb’s legs, which sent McNabb into the boards. The play wasn’t ruled a penalty, and it led to the Oilers eventually going into transition before Draisaitl converted a 2-on-1 chance for the winner.
“It’s pretty clear it’s a penalty,” Golden Knights captain Mark Stone said. “His stick is between McNabb’s legs, and he sends him headfirst into the boards. It’s a pretty clear-cut penalty in my eyes and I think everybody’s eyes, right? But that’s hockey. You don’t always get the calls.”
Golden Knights coach Bruce Cassidy was a bit more direct about what he saw on the McNabb play.
“Listen, Gord’s looking at it. He blew it. He missed the call,” Cassidy said. “I don’t know what else to say. It’s a can-opener trip, it’s a dangerous play, it’s all those things. But it didn’t get called, so you’ve got to keep playing.”
Cassidy said he didn’t have an immediate update on McNabb’s status for Game 3 on Saturday in Edmonton. If he were to miss Game 3, it would leave the Golden Knights without one of their most important players.
McNabb, who was part of their Stanley Cup-winning team in 2023, is one of their top-pairing options and also a crucial piece of a penalty kill that had a significant role in how the Golden Knights survived so late in overtime.
An urgently aggressive Golden Knights team kept pushing to start the first period before forward Victor Olofsson opened with his first-ever playoff goal on the power play in the first period. Three consecutive goals from Oilers trio Jake Walman, Vasily Podkolzin and Darnell Nurse gave them a 3-1 lead. Golden Knights forward William Karlsson scored late in the second to cut it to 3-2.
Oilers forward Evander Kane doubled the lead to 4-2 within the first two minutes of the third before Olofsson’s second, also on the power play, less than three minutes later again cut the lead to a single goal. The Golden Knights forced overtime when alternate captain and star defenseman Alex Pietrangelo fired a shot from distance with 8:02 remaining in regulation.
Vegas had two chances in the final 30 seconds, only to have them both stopped by Edmonton goaltender Calvin Pickard, who finished with 28 saves, before heading to overtime.
Olofsson had a chance at a game-winning hat trick with a point-blank chance with 18:45 remaining before Nurse’s stick stopped him from having a clean shot.
“Definitely had a lot of good looks, and I think we could have had a couple more goals,” Olofsson said of a Golden Knights team that finished with 19 high-danger scoring chances.
Natural Stat Trick’s metrics show that Vegas’ shot-share in overtime was 66.7%. But even in a period in which they controlled possession, there was a moment when they nearly lost their grip.
Golden Knights forward Nicolas Roy received a five-minute major for cross-checking after his stick connected with Trent Frederic’s face. Roy appeared as if he was trying to play a puck in midair, only to then strike Frederic, which sent the Oilers on the power play.
The NHL’s No. 12 power-play unit in the regular season, the Oilers had a few chances on net but were either stopped by Golden Knights goaltender Adin Hill or had their chances broken up by an aggressive forecheck that allowed them to go through unscathed.
With a pair of power-play goals already, the Golden Knights believed they could have added a third once McNabb went into the boards.
Instead? They watched the Oilers regroup, Draisaitl get on a 2-on-1 and beat Hill for the win.
“This one will sting,” Cassidy said. “But the positives tomorrow will be good. I felt that we outplayed the Oilers for the most part and deserved a better fate. How the guys look at that? If they take it as, ‘We just gotta carry that over’ — we both said we wanted to get better as the series went on and we were certainly better than Game 1. So, we’ll improve on today if we want to get back into it.”
Going back to their first campaign in the 2017-18 season, the Golden Knights have made the playoffs in all but one year. Throughout that time, they’ve been in a 2-0 series hole once, against the Colorado Avalanche in a second-round series back in 2021.
The Golden Knights would come back to win that series with four consecutive victories.
“I liked our game today; we had a lot of good chances,” said Stone, who is one of nine players who remain from that team in 2021. “We put up four goals, and usually when you score four goals, you’re going to win a playoff game. Unfortunately, we didn’t. You can’t get down, you got to go to Edmonton tomorrow, get ready for Saturday night’s game and put your best foot forward and get a win.”
US President Donald Trump (R) and Saudi Deputy Crown Prince Mohammad bin Salman al-Saud take part in a bilateral meeting at a hotel in Riyadh on May 20, 2017.
Mandel Ngan | AFP | Getty Images
DUBAI, United Arab Emirates — U.S. President Donald Trump will touch down in the Persian Gulf region – or as he may soon be calling it, the Arabian Gulf – on May 13, for an official trip with stops in Saudi Arabia, Qatar and the United Arab Emirates.
The stakes are high, as the visits take place amid turbulent geopolitical tensions. On the agenda will be Israel-Gaza war ceasefire talks, oil, trade, investment deals, and the potential for new policy developments in the areas of advanced semiconductor exports and nuclear programs.
“We expect to see a lot of announcements. And I think in a broad spectrum of areas as well,” Monica Malik, chief economist at Abu Dhabi Commercial Bank, told CNBC’s Dan Murphy on Friday. She noted the potential removal of Trump’s 10% tariffs on aluminum and steel, which would be a positive for the Gulf states as some of them export those metals to the U.S., though they make up only a small percentage of the countries’ GDPs.
Trump has long enjoyed a warm relationship with Gulf Arab states, in particular the UAE and Saudi Arabia, where his children have several business ventures and planned real estate projects. Those relationships could strengthen the countries’ hands when it comes to negotiating new trade deals – while also raising concerns among critics over potential conflicts of interest, accusations the Trump family rejects.
During the president’s initial term in office, his first overseas trip was to Saudi Arabia – a country now hosting the negotiations that Trump hopes will end the Russia-Ukraine war, making the kingdom ever more important to Washington. Qatar, meanwhile, has played a central role in negotiations between Israel and Hamas over ceasefires and hostage releases.
Wall Street and AI in the Gulf
The presidential visit is drawing several Wall Street and Silicon Valley titans to the Saudi kingdom. A Saudi-U.S. investment forum announced just this week and set to take place on May 13 in Riyadh will feature guests including BlackRock CEO Larry Fink, Palantir CEO Alex Karp, and CEOs of major firms like Citigroup, IBM, Qualcomm, Alphabet, and Franklin Templeton, among others. White House AI and crypto czar David Sacks will also be in attendance.
“We also expect to see a lot of investment deals being announced,” Malik said. “And both ways, we’ve already seen the UAE announce a number of investments in the U.S. in areas such as AI, energy, aluminum, but we also think that there will be opportunities for U.S. companies to increase investment.”
Both Saudi Arabia and the UAE have invested heavily in AI infrastructure with the goal of becoming global hubs for the technology. Therefore, likely top of mind for those leaders is the future of U.S. semiconductor exports, the most advanced of which they so far have not gained access to due to national security concerns. But that may soon be changing.
The Trump administration on Wednesday announced its plan to rescind a Biden era “AI diffusion rule,” which imposed strict export controls on advanced AI chips, even to U.S.-friendly nations. The rule will be replaced with “a much simpler rule that unleashes American innovation and ensures American AI dominance,” a U.S. Commerce Department spokesperson said Wednesday, though the details of the new rule have not yet been shared.
The UAE’s state AI firm G42 has made efforts to align with U.S. regulations, including divesting from Chinese companies and partnering with Microsoft, which last year invested $1.5 billion in G42.
Nuclear ambitions
The Trump administration has been actively engaged in talks with Iran over its nuclear program – talks that the UAE and Saudi Arabia have expressed support for. That enthusiasm marks a stark contrast to those countries’ attitudes toward any U.S. deals with Tehran during the Obama years.
At the same time, Saudi Arabia wants its own civilian nuclear program and has asked the U.S. for approvals and assistance in this direction. Any U.S. support for a Saudi nuclear program was previously contingent on Saudi Arabia normalizing diplomatic relations with U.S. ally Israel – but that could change during this visit, according to media reports citing sources with knowledge of the matter.
U.S. Energy Secretary Chris Wright, during a visit to the kingdom in April, said that Saudi Arabia and the U.S. were on a “pathway” to a civil nuclear agreement – but that any further announcements would come from Trump himself.
Israel-Gaza negotiations
Another major topic will be the future of Gaza. Trump has vowed to bring about an end to the war, while also controversially suggesting that the U.S. could take control of the war-ravaged Strip which he described as “important real estate,” comments that drew strong rebukes from Arab leaders.
The U.S. has continued to push for ceasefire deals, most recently floating a 21-day cessation of hostilities and release of some hostages, while Israel this week approved expanding fighting and territorial control in Gaza.
“We have yet to hear a comprehensive plan from the Arab world,” Greg Branch, founder of UAE-based Branch Global Capital Advisors, told CNBC on Friday while discussing Trump’s upcoming visit.
“If we’re going to see a response that’s going to be Arab-led, it’s probably now or never,” Branch said. “I think that will be handled very delicately behind the scenes … probably more of a long-term geopolitical risk than any immediate macro risk.”
Oil and financing
Branch suggested that lifting U.S. sanctions on Syria under its new government could also potentially be discussed. Meanwhile, reports that the Trump administration will announce a U.S. renaming of the Persian Gulf to the Arabian Gulf would be enthusiastically welcomed by Arab states, but could draw severe anger from Iran at a time of delicate nuclear negotiations with Tehran.
Oil prices will also be in focus; Trump has long pushed OPEC states, led by Saudi Arabia, to pump more oil to lower prices for American consumers. For a combination of reasons, Saudi Arabia is doing precisely that – but it may have to change course in the coming months if prices stay subdued, hurting the kingdom’s revenues.
In that vein, financing will be an important agenda item for the kingdom during Trump’s visit, according to ADCB’s Malik.
Saudi Arabia in November pledged to invest $600 billion in the U.S. over the course of Trump’s term — but it also has sky-high costs for its own Vision 2030 investment ambitions. Lower global oil prices and big-ticket public spending projects have brought about widening budget deficits for Riyadh.
“With oil prices where they are, Saudi will look at more financing support from America as well as they look to progress with their investment program,” Malik said.
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