Treasury Secretary Scott Bessent Says China Has ‘Singular Opportunity’ To Reform Its Economy

Bessent added that he believes China will honor their end of the bargain, but stopped short of divulging exactly what the framework entails.

Treasury Secretary Scott Bessent called on China to be a “reliable” trade partner, hours after finalizing a framework with Chinese government officials in London to defuse ongoing tensions between the world’s top two economies.

In a testimony before the House of Representatives Ways and Means Committee, Bessent said that China has a “singular opportunity” to stabilize its economy and move it away from excessive manufacturing for exports, to balance it for domestic consumption instead.

Stating that China needs to be a reliable partner in trade negotiations, Bessent said the London framework will stabilize and balance the economic relationship between the two countries.

“If China will course-correct by upholding its end of the initial trade agreement we outlined in Geneva last month, then a big, beautiful rebalancing of the world’s two largest economies is possible,” he said.

Bessent added that he believed China would honor their end of the bargain, but stopped short of divulging exactly what the framework entails.

However, President Donald Trump revealed that China will supply rare earth resources and magnets upfront as part of the deal. At the same time, the U.S. will fulfill its commitments, including providing access to colleges and universities for Chinese students.

It’s not clear yet if this is all that China sought from the U.S. – export controls on semiconductor chips were reportedly a bone of contention for the Xi Jinping administration.

Chinese Vice Premier He Lifeng urged the U.S. and China to follow through on their commitments and “show the spirit of good faith.”

Bessent has also been critical of China’s economic setup in the past. In April, the Treasury Secretary lampooned the country as one of the “worst offenders” in international trade.

He added that China has the “most imbalanced economy in the history of the modern world.”

Meanwhile, U.S. equity markets edged up due to positive news about the trade deal and a favorable inflation print.

The SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was up 0.22% at the time of writing.

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