AsianFin -- The Trump administration could resume its higher reciprocal tariffs on trading partners even if trading partners are engaging in negotiations in good faith when the 90-day pause on higher tariffs ends, U.S. Treasury Secretary Scott Bessent warned on Monday.
Credit：China Central Television
Bessent said in a Bloomberg interview that he expects U.S. will make “a flurry” of trade deals with trading partners ahead of the July 9 deadline, which is when the Trump administration’s reciprocal tariffs return to higher levels from the baseline level 10%. But he warned that "recalcitrant" countries that their tariff levels could soon snap back to the levels announced on April 2, a date U.S. President Donald Trump proclaimed “Liberation Day”.
"We have countries that are negotiating in good faith, but they should be aware that if we can't get across the line because they are being recalcitrant, then we could spring back to the April 2 levels. I hope that won't have to happen," Bessent said. He added that any potential extensions will be Trump’s decision.
Bessent issued the warning after Trump suggested he would like to stick to the July 9 deadline, instead of extension. In an interview with Fox News broadcast on Sunday, Trump said he doesn’t think he will need to extend the deadline and his administration would notify countries that they have to face higher tariffs unless they strike deals with the U.S.
“We’ll look at how a country treats us — are they good, are they not so good — some countries we don’t care, we’ll just send a high number out,” said Trump. He said letters to notify countries about future trade penalties will start going out soon before the July 9 deadline. Letters would say, “Congratulations, we’re allowing you to shop in the United States of America, you’re going to pay a 25% tariff, or a 35% or a 50% or 10%,” said the president.
Bessent and Trump’s remarks adds appeared more ambiguity in the U.S. government’s stance on the July 9 deadline.
Bessent in June became the first senior Trump official that has indicated some flexibility for the tariff pause when he testified before the House Ways and Means Committee.
Bessent emphasized throughout the hearing on June 11 that he’s focused on negotiations with the 18 US trading partners who account for 90% of the trade and suggests that regional deals are possible with smaller countries. Questioned about whether the so-called reciprocal tariffs would enter effect when a 90-day pause ends, Bessent responded the Trump administration is “highly likely” to delay tariffs for countries involved in good-faith trade talks.
"It is highly likely that those countries - or trading blocs as is the case with the EU - who are negotiating in good faith, we will roll the date forward to continue the good-faith negotiations," Bessent told House of Representatives. ”If someone is not negotiating, then we will not.”
“The deadline is not critical,” White House press secretary Karoline Leavitt said in a press briefing. She told reporters that Trump “can simply provide these countries with the deal if they refuse to make us one by the deadline," and that means the president can pick “a reciprocal tariff rate that he believes is advantageous for the United States.”
Bessent last Friday suggested the July deadline could be delayed to September 1, this year’s Labor Day, as the Trump administration hopes to wrap up deals with more than a dozen countries. He noted U.S. Commerce Secretary Howard Lutnick’s comments on Thursday that the White House has imminent plans to reach agreements with 10 major trading partners. “If we can ink 10 or 12 of the important 18 — there are another important 20 relationships — then I think we could have trade wrapped up by Labor Day,” Bessent said on Fox Business Network.
Trump on Friday implied flexibility of the July deadline while cautioning he’s mulling higher tariffs for smaller countries that have not reached deals with the U.S. Asked if the mid-July deadline was set in stone, Trump replied: “We can do whatever we want. We could extend it, we could make it shorter. I’d like to make it shorter. I’d like to just sent letters out to everybody, ‘Congratulations, you’re paying 25%.’”
