Bessent Floats Longer Tariff Truce for China Rare Earth Delay
Summary
China's Export Controls: China announced an expansion of export controls on rare earth elements, impacting global supply chains and potentially affecting various industries, including technology and defense.
Global Economic Impact: The new Chinese measures could disrupt the global economy by requiring approval for products containing even small amounts of Chinese-mined minerals, affecting semiconductors and consumer goods worldwide.
Trade Negotiations: The U.S. and China had previously agreed to suspend tariffs and rare earth measures, but China's recent actions are seen as a breach of this agreement, escalating tensions between the two nations.
Decoupling vs. De-risking: The U.S. emphasizes the need to de-risk and diversify supply chains away from China, rather than fully decoupling, in response to China's control over rare earth materials.
Tariff Implications: The U.S. is prepared to raise tariffs on Chinese goods if China implements its new export control system, highlighting ongoing trade tensions and the potential for further economic conflict.
International Cooperation: The U.S. is working closely with allies to address China's actions, emphasizing the importance of a coordinated response to maintain global supply chain stability.
Potential for Resolution: Despite the tensions, there is optimism for de-escalation through continued dialogue, with upcoming meetings between U.S. and Chinese leaders offering a potential path forward.
Transcript
Thank you, everybody, for coming. And I want to express my appreciation to the staff here at the Treasury Department. Obviously, we're still in shutdown because the Democrats refused to open the government. So it has created some additional logistical constraints. But we appreciate everyone's patience and willingness during the Schumer shutdown with respect to the matter at hand. Last Wednesday evening, China announced a sweeping expansion of its export controls on rare earth elements and rare earth processing equipment, as well as technologies related to batteries, vehicles, industrial diamonds and super hard materials. To be clear, this is not just about the United States. These actions, if implemented, would apply to the entire world. China's announcement is nothing more than a global supply chain power grab. Well, China has taken a number of retaliatory trade actions against the United States, Europe, Canada, Australia and others in recent years. This move is not proportional retaliation. It is an exercise in economic coercion on every country in the world. At its core, China's new measures include a rule saying that any product of which more than 0.1% of minerals consist of minerals mined are processed in China. One must seek approval from the Chinese government before trading it. Since many important semiconductors, for example, have these critical minerals and semiconductors are in nearly everything. This rule gives China control over basically the entire global economy in the technology supply chain. This will impact artificial intelligence systems and high tech products. But even regular consumer items like cars, smartphones and potentially even household appliances could be affected. It would also apply to many items that are necessary for defence purposes. And again, it covers the whole world. For example, if a smartphone is made in Korea and sold to Australia, then the company would first need to get China's approval. Since the phone contains semiconductors, which may contain rare earths sourced from China, or if a car is built in America and sold in Mexico, you would need to seek approval from China before making the sale. Because of the chips in the car, obviously neither we nor our allies are going to go along with that kind of system. Many are suggesting that China's action is simply posturing for leverage in negotiations with the United States. While that may be one element of China's approach, it's obvious that these controls are part of a broader plan by China to control the world's supply chains, And these controls are wildly out of proportion to any targeted actions by the United States or its allies over the past few months. Others have suggested that the United States has violated a non-existent agreement with the Chinese regarding export controls or the implementation of measures. This is a false narrative deployed to justify these broad and unacceptable Chinese actions. There is, in fact a published agreement between the United States and China from earlier this year that the US and China would suspend tariffs of over 100% on each other. China further agreed to effectively suspend elements of its rare earths export control regime by expeditiously approving licenses for U.S. companies seeking rare earths. Both countries agreed to this pause on tariffs and rare earth measures for 90 days while we pursued further negotiations, which have gone on quite successfully for the past six months. And there is a published agreement about this on official U.S. government and Chinese websites. This is the Geneva agreement. It's not a secret. It's out there. It's published. We keep our tariffs low. They keep the virus flowing. We have not imposed reciprocal tariffs on the Chinese since that time. But now the Chinese have expanded their rare earth controls. We have complied. They have not. And so in this context, this is how China how China has announced its new and extremely expensive controls on rare earth materials just last week. It's a clear repudiation of everything we've been working toward for the last six months, which was a stable tariff situation and a continued flow of rare earths. The short story is that we've had compliance and the Chinese have escalated and they've taken this opportunity to make a pretextual claim of non-compliance or other measures to justify this. But the United States won't stand for it. We're in close communication with our allies who have expressed similar views and who are similarly affected. The President has signalled some of the actions we are taking or may take if the Chinese implement this system of controls on the world. Mr. Secretary. Good. Thank you, Ambassador Greer. And again, thank you all for being here. At Treasury today in the midst of this shutdown. We call on the moderate Democrats in the Senate to be heroes. Be heroes. Break away from the hive of radicalism and do something for the American people because we are starting to cut into a muscle here. We believe that the shutdown may start costing the U.S. economy up to $15 billion a day. And this is a decision the Democrats are making. And one of the reasons that they are not being held to task is because the mainstream media is not coming at them the way they would have if the Republicans were willing to keep the government closed. It is a very simple decision. Mike Johnson passed a clean C.R. later, Thune has the clean C.R. Three Democrats have voted for it. And right here, right now, I am calling for the moderate Democrats to be heroes, be heroes and reopen the government for the American people. So with that, I want to say that. Thank you. Good morning to all of you. It's a shame we can't have more people here. But I believe that the Democrats will come to their senses soon. Maybe it's after this. No kings and but no kings equal, no paychecks. Before we start on Q&A, I'd like to make a few points on China. As the president has said, we want to help China, not hurt it. If some in the Chinese government want to slow down the global economy through disappointing actions and through economic coercion, the Chinese economy will be hurt the most. And make no mistake, this is China versus the world. They have put these unacceptable export controls on the entire world. China is a command and control economy and we and our allies will neither be commanded nor controlled. They are a state economy and we are not going to let a group of bureaucrats in Beijing try to manage the global supply chains. As Ambassador Greer said, we had a document and an agreement in Geneva and magnets were flowing quite well. Some of some U.S. auto companies have called us in the past week and said that there had been a slowdown in markets. So when we asked the Chinese about this, they said, oh, it probably had something to do with the holiday, had something to do with the holiday. So they can't be trusted with the global supply chain had something to do with the holiday. Moreover, we should. This should be a clear sign to our allies that we must work together. And work together. We will. There will be a series of meetings this week. During World Bank, IMF week. And we are all one. Not only is China feeling Russia's war, but China's actions have once again demonstrated the risk of being dependent on them on rare earths and for that matter, anything. If China wants to be an unreliable partner to the world, then the world will have to decouple. The world does not want to decouple. We want to de-risk. But signals like this are signs of decoupling, which we don't believe China wants. And again, we do not want to decouple. We should work together to de-risk and diversify our supply chains away from China as quickly as possible. China says these rivers are used in military materials and that they want to maintain peace in the world. Again, it is a purchase of China, of Russian oil by China that fuels the Russian war machine. China buys 66 0% of Russian energy. They buy 90% of Iranian energy. So who is fueling the Russian war machine? We will be producing photos soon supplied to us by the Ukrainian government that shows Chinese parts comprise substantial amounts of Ukrainian drones. So President Trump is the leader of peace. We should work together to de-risk and diversify. China's highly provocative move comes after we've made significant, significant efforts to de-escalate tensions. While there are substantial actions we could take, we'd rather not. I believe China is open to discussion and I am optimistic that this can be de-escalated. Ultimately, we are confident in the strong relationship between President Trump and President Xi. We've had substantial communication with the Chinese over the past few days, and we believe that there will be more forthcoming this week. With that, we can now take your questions Eliot. Great. Thank you. First question, Eamon Javers, CNBC. Very interesting to see your cnbc interview just now. You namechecked a chinese negotiator, lee chang gong, i believe, is how you pronounce his name from the ministry of commerce. As somebody who's particularly difficult to deal with, is it your sense that there's a split politically with inside the Chinese negotiating team? Or do you think you're dealing with sort of a strategic good cop, bad cop kind of relationship on the other side of the table? It's very difficult to know what what perhaps the the vice minister who showed up here with very incendiary, endearing language on August 28th is has gone rogue, that perhaps he's gone rogue. So we don't we don't know. But what we do know what we do know is, as Ambassador Revere said, any backfilling that the Chinese are trying to do in terms of narrative, this was well flagged. This individual was very disrespectful. And I'll tell you that we've had four rounds of talks Geneva, London, Stockholm and Madrid, and both sides approach them with great respect. And this individual did not. He showed up uninvited in. Washington and said, quote, China will cause global chaos if this if the port shipping fees go through. So I don't believe that China wants to be an agent of chaos. And maybe maybe they used to have the wolf warrior diplomats. So, you know, maybe he thinks he's a wolf warrior. We don't know. He was in a Chinese location. That's up to them. Thank you. Next question will go to. Christine with NBC. Thank you for this. Christine Romans, NBC News. What do you need to see specifically from the Chinese to avoid putting more tariffs on Chinese goods, as the president threatened on Friday? And are the two leaders still expected to meet in the next few weeks? I will say that I believe as a last time I saw President Trump, which was last night, he is still expecting to see party Chair Xi in Korea. And our Jamieson, Ambassador Greer, answer The first part in the expectation is that this this regulatory system is not implemented by the Chinese. They haven't implemented yet. They've put out a notice about it. Similarly, we've signaled our intent to raise tariffs if their system goes into effect. Our documents doing a tariff raise and potentially taking other export controls. These are drafted or in draft. So this is quite real. But our expectation is that they won't implement this and that we'll be able to be back to where we were a week ago, where we had the tariff levels we've agreed to and we have the flow of various magnets we agreed to so much. Next question. I'm going to go to Laurence Fox. Thank thanks for taking the questions. So the Chinese have been pretty good at using this rare earth mineral trump card, for lack of a better term. So we're not talking about opening the Chinese market to U.S. trade. We're not talking about the protecting intellectual property. Can there be a sustainable framework, a substantial framework with China? So there is room for a positive economic relationship with China? There certainly is. And we would much rather be talking about that than constantly be talking about rare earths. To paraphrase the secretary at one of our recent meetings with the Chinese, this is the last time we want to be talking about rare earths with the Chinese. Fortunately, that is not the last time they want to be talking about it. The reality is there are a lot of areas where we can trade with the Chinese. Our trade is wildly imbalanced, so it needs to be more balanced. And there is a lot of, as the secretary has said, areas of risk. And so we need to be trading in areas that are low risk, that are low sensitivity. And there are a lot of areas where both the Chinese and us can frankly pick and choose sectors and goods that we should be trading and services for that matter. And that's where these talks should be focused. Instead, we're constantly focused on the Chinese chokehold, on the world of rare earths and rare earth materials. And it's a there's an article in the paper today a large Chinese fashion retailer just opened on Fifth Avenue in New York. It's a competitor to Zara and H&M. We welcome that. We would also like to see more U.S. retailers on the ground in China. But Costco and Wal-Mart have very big operations there. So, again, our goal is not to decouple. It's to de-risk. It seems that China's not fazed by our it seems that China is not fazed by our tariffs. What levers then, do we have left? I can guarantee you, when we were in Geneva and the tariffs were 145%, they were faced. John Decker. Great. Thank you. Thank you, Mr. Secretary. Ambassador Greer, I really appreciate your taking the opportunity. I have a question for both of you about this upcoming case at the U.S. Supreme Court. It's an incredibly important case that could impact the constitutionality of the president's unilateral tariffs on America's trading partners. Really basic question for you just to begin with. I have two questions for you. Why are the president's tariffs not taxes on imported goods? That's easy because tariffs are surcharge, not a tax. They could be paid by the exporter. They could be paid by the country. When you go to get your driver's license, you pay a fee. Is that a tax? So the tax. I'm asking you a question and I just appreciate it. Thank you. And if we. Well, I'm giving you an answer that maybe you don't like. The other thing is, in this case and Ambassador Jamieson is a lawyer. I'm not. As am I. Thank you. I won't tell you the one thing I agreed with Leonard on. So but I think that we see with this Chinese provocation why it is very important to for the president to have emergency powers to implement tariffs, because we he needs to be able to use this to push back against this Chinese overreach against the world. So if it was not clear to anyone on the court before last week that the president needs emergency powers to protect the American people and the American economy, then it should be abundantly clear now. So my second question concerns the idea that 1977 law. The question is about Brazil, the 50% tariffs on Brazil. Can you explain why they are being hit with 50% tariffs and why it falls under the umbrella of the International Emergency Economic Powers Act? Certainly happy to do that. Now, to be really specific about Brazil. There's actually two regimes in place right here. There's the reciprocal tariff rate of 10% on Brazil, which everyone in the world has, which we're trying to do to control the global trade deficit is a huge problem for us. And on top of that, there's a 40% tariff on Brazil, and that's under a separate emergency. And this is related to extreme concerns with rule of law, censorship and human rights in Brazil, where a Brazilian judge has taken it upon himself to order U.S. companies to censor themselves, giving them secret orders to manage the flow of information, rule of law with respect to political opponents in Brazil. And so when when the unlawful detention of U.S. citizens who were in Brazil. Correct. Now, the Treasury Department has often used EPA, which is the shorthand for the law you're talking about, to impose sanctions, which will cut off countries or companies or persons entirely from the U.S. financial system and cut off trade entirely. If the president can cut off trade entirely. He can certainly impose a tariff, which is a lesser measure than a full sanction. Question from James with Newsmax. Thank you. James Rosen with Newsmax. Thank you both for doing this. I have two questions for the secretary. One of them, I'll leave for second, a slightly historical nature. And you are a historian. First, you mentioned in your opening remarks, quite apart from the expansion of the export controls that China is singularly responsible for propping up the Russian war machine in Ukraine. We also know about the outsized Chinese role in the manufacture of the precursors for the fentanyl that is killing an estimated 100,000 Americans a year. So quite apart from the export control slice of this, should not Beijing feel the the full weight of American punishment just for those two other aspects, the fentanyl and the propping up of the war machine. And then one historical question. Right. So a couple of things that the U.S. President Trump has instructed the ambassador and myself to tell our European allies that we would be in favor of whether you want to call it a Russian oil tariff on China or a Ukrainian victory tariff on China. But our Ukraine, our European allies, have to be willing to follow. We are sitting here during a government shutdown when we can't get seven more Democratic senators across the line. But 8585 U.S. senators are willing to give President Trump the authority to put up to 500% tariffs on China for the purchase of Russian oil. We are told that Ukraine, the European Parliament, will not pass a similar measure. So all I hear from the Europeans is that Putin is coming to Warsaw. There are very few things in life I'm sure about. I'm sure he's not coming to Boston. So we will respond. If are Ukrainian, if our European partners will join us. The second we do have the 20% of we have a 20% phenol tariff on China. And again, they have all but admitted that they sell the precursor drugs. When we have the discussion, they take off the tariff and then we can fix it. We say fix it and show us six months of persistent persistence and then we will take off the tariff. So again, back to the IPR, if 100,000, 200,000 Americans being killed every year by fentanyl families, ruined is not an emergency. I'm not sure what is. And by the way, if the Chinese can cut off rare earths and export control, then they certainly can't control the precursors for fentanyl as well during the process. Very quickly, when the history of this time is written and historians are paying attention to President Trump's decision making surrounding the global tariff program that he has initiated. Can you tell us, to your knowledge, when it was, whether it was during the campaign or the preceding four years or during the transition or since he took office again, that he decided that he was going not only to rely more heavily on tariffs than he did in his first term, but to go as big on tariffs as he has. When was that decision taken? Oh, I think the decision was taken in the first term. And you would have seen President Trump saying that over the past since January 20th, that he would have had a very successful tariff program on China in terms of rebalancing, in terms of purchases that they were supposed to make, which they haven't followed up on. But you you've heard President Trump say that in his in his final year. So trade deals reached with China on January 20th, He was going to expand the tariffs to the world and then COVID hit and out of humanitarian necessity, it would not have been appropriate to start putting on tariffs during a period of such great economic disruption. I had a very powerful meeting immediately after this. All we have time for one question. I'm gonna go do the print folks in the back. Dimitri from the FDA. Thank you, Dmitri. Financial Times and BuzzFeed. I think you said that you don't expect China to implement the reverts regime that it announced. Is that based on something that the Chinese said to you, or if not, what gives you that confidence? And then secondly, if the Chinese were to say we will delay implementation by, let's say, six months or one year, would that be enough for you to delay implementation or imposition of 100% tariffs and other countermeasures? Thank you. So so the Chinese obviously will decide what they're going to do, right? That's not up to me. I'm just outlining our expectation for this program. You know, I see at a minimum, they have to delay it. Our expectation is that this never goes into effect because you can't when you look at what happened with the rare earth magnets, they had a similar program that they implemented. And that program, the result was that they couldn't implement it. They didn't have enough people to organize it, separate and apart from it being just wrong entirely. They actually couldn't implement it, and it took months and months to get the flow of magnets to something that was barely tolerable. Right now, take that program, which was trying to deal with thousands of license applications and multiply it by a thousand. That's what we're talking about because we're not just talking about the rare earths themselves. We're talking about many downstream products that contain those rare earths. Remember, 0.1% of 0.1% of a product to the Chinese rare earth in it. It could be controlled by this. I mean that the scope, the scope and the scale is just unimaginable and it cannot be implemented. And we need to follow up on that. Right now, we are currently in a 90 day roll on the tariffs. So is it possible that we could go to a longer role in return for a delay, perhaps. But, you know, all that's going to be negotiated in the coming weeks before that, before the leaders meet in Korea. Thank you, everybody. With apologies again.
Bessent Floats Longer Tariff Truce for China Rare Earth Delay
Summary
Transcript
Thank you, everybody, for coming. And I want to express my appreciation to the staff here at the Treasury Department. Obviously, we're still in shutdown because the Democrats refused to open the government. So it has created some additional logistical constraints. But we appreciate everyone's patience and willingness during the Schumer shutdown with respect to the matter at hand. Last Wednesday evening, China announced a sweeping expansion of its export controls on rare earth elements and rare earth processing equipment, as well as technologies related to batteries, vehicles, industrial diamonds and super hard materials. To be clear, this is not just about the United States. These actions, if implemented, would apply to the entire world. China's announcement is nothing more than a global supply chain power grab. Well, China has taken a number of retaliatory trade actions against the United States, Europe, Canada, Australia and others in recent years. This move is not proportional retaliation. It is an exercise in economic coercion on every country in the world. At its core, China's new measures include a rule saying that any product of which more than 0.1% of minerals consist of minerals mined are processed in China. One must seek approval from the Chinese government before trading it. Since many important semiconductors, for example, have these critical minerals and semiconductors are in nearly everything. This rule gives China control over basically the entire global economy in the technology supply chain. This will impact artificial intelligence systems and high tech products. But even regular consumer items like cars, smartphones and potentially even household appliances could be affected. It would also apply to many items that are necessary for defence purposes. And again, it covers the whole world. For example, if a smartphone is made in Korea and sold to Australia, then the company would first need to get China's approval. Since the phone contains semiconductors, which may contain rare earths sourced from China, or if a car is built in America and sold in Mexico, you would need to seek approval from China before making the sale. Because of the chips in the car, obviously neither we nor our allies are going to go along with that kind of system. Many are suggesting that China's action is simply posturing for leverage in negotiations with the United States. While that may be one element of China's approach, it's obvious that these controls are part of a broader plan by China to control the world's supply chains, And these controls are wildly out of proportion to any targeted actions by the United States or its allies over the past few months. Others have suggested that the United States has violated a non-existent agreement with the Chinese regarding export controls or the implementation of measures. This is a false narrative deployed to justify these broad and unacceptable Chinese actions. There is, in fact a published agreement between the United States and China from earlier this year that the US and China would suspend tariffs of over 100% on each other. China further agreed to effectively suspend elements of its rare earths export control regime by expeditiously approving licenses for U.S. companies seeking rare earths. Both countries agreed to this pause on tariffs and rare earth measures for 90 days while we pursued further negotiations, which have gone on quite successfully for the past six months. And there is a published agreement about this on official U.S. government and Chinese websites. This is the Geneva agreement. It's not a secret. It's out there. It's published. We keep our tariffs low. They keep the virus flowing. We have not imposed reciprocal tariffs on the Chinese since that time. But now the Chinese have expanded their rare earth controls. We have complied. They have not. And so in this context, this is how China how China has announced its new and extremely expensive controls on rare earth materials just last week. It's a clear repudiation of everything we've been working toward for the last six months, which was a stable tariff situation and a continued flow of rare earths. The short story is that we've had compliance and the Chinese have escalated and they've taken this opportunity to make a pretextual claim of non-compliance or other measures to justify this. But the United States won't stand for it. We're in close communication with our allies who have expressed similar views and who are similarly affected. The President has signalled some of the actions we are taking or may take if the Chinese implement this system of controls on the world. Mr. Secretary. Good. Thank you, Ambassador Greer. And again, thank you all for being here. At Treasury today in the midst of this shutdown. We call on the moderate Democrats in the Senate to be heroes. Be heroes. Break away from the hive of radicalism and do something for the American people because we are starting to cut into a muscle here. We believe that the shutdown may start costing the U.S. economy up to $15 billion a day. And this is a decision the Democrats are making. And one of the reasons that they are not being held to task is because the mainstream media is not coming at them the way they would have if the Republicans were willing to keep the government closed. It is a very simple decision. Mike Johnson passed a clean C.R. later, Thune has the clean C.R. Three Democrats have voted for it. And right here, right now, I am calling for the moderate Democrats to be heroes, be heroes and reopen the government for the American people. So with that, I want to say that. Thank you. Good morning to all of you. It's a shame we can't have more people here. But I believe that the Democrats will come to their senses soon. Maybe it's after this. No kings and but no kings equal, no paychecks. Before we start on Q&A, I'd like to make a few points on China. As the president has said, we want to help China, not hurt it. If some in the Chinese government want to slow down the global economy through disappointing actions and through economic coercion, the Chinese economy will be hurt the most. And make no mistake, this is China versus the world. They have put these unacceptable export controls on the entire world. China is a command and control economy and we and our allies will neither be commanded nor controlled. They are a state economy and we are not going to let a group of bureaucrats in Beijing try to manage the global supply chains. As Ambassador Greer said, we had a document and an agreement in Geneva and magnets were flowing quite well. Some of some U.S. auto companies have called us in the past week and said that there had been a slowdown in markets. So when we asked the Chinese about this, they said, oh, it probably had something to do with the holiday, had something to do with the holiday. So they can't be trusted with the global supply chain had something to do with the holiday. Moreover, we should. This should be a clear sign to our allies that we must work together. And work together. We will. There will be a series of meetings this week. During World Bank, IMF week. And we are all one. Not only is China feeling Russia's war, but China's actions have once again demonstrated the risk of being dependent on them on rare earths and for that matter, anything. If China wants to be an unreliable partner to the world, then the world will have to decouple. The world does not want to decouple. We want to de-risk. But signals like this are signs of decoupling, which we don't believe China wants. And again, we do not want to decouple. We should work together to de-risk and diversify our supply chains away from China as quickly as possible. China says these rivers are used in military materials and that they want to maintain peace in the world. Again, it is a purchase of China, of Russian oil by China that fuels the Russian war machine. China buys 66 0% of Russian energy. They buy 90% of Iranian energy. So who is fueling the Russian war machine? We will be producing photos soon supplied to us by the Ukrainian government that shows Chinese parts comprise substantial amounts of Ukrainian drones. So President Trump is the leader of peace. We should work together to de-risk and diversify. China's highly provocative move comes after we've made significant, significant efforts to de-escalate tensions. While there are substantial actions we could take, we'd rather not. I believe China is open to discussion and I am optimistic that this can be de-escalated. Ultimately, we are confident in the strong relationship between President Trump and President Xi. We've had substantial communication with the Chinese over the past few days, and we believe that there will be more forthcoming this week. With that, we can now take your questions Eliot. Great. Thank you. First question, Eamon Javers, CNBC. Very interesting to see your cnbc interview just now. You namechecked a chinese negotiator, lee chang gong, i believe, is how you pronounce his name from the ministry of commerce. As somebody who's particularly difficult to deal with, is it your sense that there's a split politically with inside the Chinese negotiating team? Or do you think you're dealing with sort of a strategic good cop, bad cop kind of relationship on the other side of the table? It's very difficult to know what what perhaps the the vice minister who showed up here with very incendiary, endearing language on August 28th is has gone rogue, that perhaps he's gone rogue. So we don't we don't know. But what we do know what we do know is, as Ambassador Revere said, any backfilling that the Chinese are trying to do in terms of narrative, this was well flagged. This individual was very disrespectful. And I'll tell you that we've had four rounds of talks Geneva, London, Stockholm and Madrid, and both sides approach them with great respect. And this individual did not. He showed up uninvited in. Washington and said, quote, China will cause global chaos if this if the port shipping fees go through. So I don't believe that China wants to be an agent of chaos. And maybe maybe they used to have the wolf warrior diplomats. So, you know, maybe he thinks he's a wolf warrior. We don't know. He was in a Chinese location. That's up to them. Thank you. Next question will go to. Christine with NBC. Thank you for this. Christine Romans, NBC News. What do you need to see specifically from the Chinese to avoid putting more tariffs on Chinese goods, as the president threatened on Friday? And are the two leaders still expected to meet in the next few weeks? I will say that I believe as a last time I saw President Trump, which was last night, he is still expecting to see party Chair Xi in Korea. And our Jamieson, Ambassador Greer, answer The first part in the expectation is that this this regulatory system is not implemented by the Chinese. They haven't implemented yet. They've put out a notice about it. Similarly, we've signaled our intent to raise tariffs if their system goes into effect. Our documents doing a tariff raise and potentially taking other export controls. These are drafted or in draft. So this is quite real. But our expectation is that they won't implement this and that we'll be able to be back to where we were a week ago, where we had the tariff levels we've agreed to and we have the flow of various magnets we agreed to so much. Next question. I'm going to go to Laurence Fox. Thank thanks for taking the questions. So the Chinese have been pretty good at using this rare earth mineral trump card, for lack of a better term. So we're not talking about opening the Chinese market to U.S. trade. We're not talking about the protecting intellectual property. Can there be a sustainable framework, a substantial framework with China? So there is room for a positive economic relationship with China? There certainly is. And we would much rather be talking about that than constantly be talking about rare earths. To paraphrase the secretary at one of our recent meetings with the Chinese, this is the last time we want to be talking about rare earths with the Chinese. Fortunately, that is not the last time they want to be talking about it. The reality is there are a lot of areas where we can trade with the Chinese. Our trade is wildly imbalanced, so it needs to be more balanced. And there is a lot of, as the secretary has said, areas of risk. And so we need to be trading in areas that are low risk, that are low sensitivity. And there are a lot of areas where both the Chinese and us can frankly pick and choose sectors and goods that we should be trading and services for that matter. And that's where these talks should be focused. Instead, we're constantly focused on the Chinese chokehold, on the world of rare earths and rare earth materials. And it's a there's an article in the paper today a large Chinese fashion retailer just opened on Fifth Avenue in New York. It's a competitor to Zara and H&M. We welcome that. We would also like to see more U.S. retailers on the ground in China. But Costco and Wal-Mart have very big operations there. So, again, our goal is not to decouple. It's to de-risk. It seems that China's not fazed by our it seems that China is not fazed by our tariffs. What levers then, do we have left? I can guarantee you, when we were in Geneva and the tariffs were 145%, they were faced. John Decker. Great. Thank you. Thank you, Mr. Secretary. Ambassador Greer, I really appreciate your taking the opportunity. I have a question for both of you about this upcoming case at the U.S. Supreme Court. It's an incredibly important case that could impact the constitutionality of the president's unilateral tariffs on America's trading partners. Really basic question for you just to begin with. I have two questions for you. Why are the president's tariffs not taxes on imported goods? That's easy because tariffs are surcharge, not a tax. They could be paid by the exporter. They could be paid by the country. When you go to get your driver's license, you pay a fee. Is that a tax? So the tax. I'm asking you a question and I just appreciate it. Thank you. And if we. Well, I'm giving you an answer that maybe you don't like. The other thing is, in this case and Ambassador Jamieson is a lawyer. I'm not. As am I. Thank you. I won't tell you the one thing I agreed with Leonard on. So but I think that we see with this Chinese provocation why it is very important to for the president to have emergency powers to implement tariffs, because we he needs to be able to use this to push back against this Chinese overreach against the world. So if it was not clear to anyone on the court before last week that the president needs emergency powers to protect the American people and the American economy, then it should be abundantly clear now. So my second question concerns the idea that 1977 law. The question is about Brazil, the 50% tariffs on Brazil. Can you explain why they are being hit with 50% tariffs and why it falls under the umbrella of the International Emergency Economic Powers Act? Certainly happy to do that. Now, to be really specific about Brazil. There's actually two regimes in place right here. There's the reciprocal tariff rate of 10% on Brazil, which everyone in the world has, which we're trying to do to control the global trade deficit is a huge problem for us. And on top of that, there's a 40% tariff on Brazil, and that's under a separate emergency. And this is related to extreme concerns with rule of law, censorship and human rights in Brazil, where a Brazilian judge has taken it upon himself to order U.S. companies to censor themselves, giving them secret orders to manage the flow of information, rule of law with respect to political opponents in Brazil. And so when when the unlawful detention of U.S. citizens who were in Brazil. Correct. Now, the Treasury Department has often used EPA, which is the shorthand for the law you're talking about, to impose sanctions, which will cut off countries or companies or persons entirely from the U.S. financial system and cut off trade entirely. If the president can cut off trade entirely. He can certainly impose a tariff, which is a lesser measure than a full sanction. Question from James with Newsmax. Thank you. James Rosen with Newsmax. Thank you both for doing this. I have two questions for the secretary. One of them, I'll leave for second, a slightly historical nature. And you are a historian. First, you mentioned in your opening remarks, quite apart from the expansion of the export controls that China is singularly responsible for propping up the Russian war machine in Ukraine. We also know about the outsized Chinese role in the manufacture of the precursors for the fentanyl that is killing an estimated 100,000 Americans a year. So quite apart from the export control slice of this, should not Beijing feel the the full weight of American punishment just for those two other aspects, the fentanyl and the propping up of the war machine. And then one historical question. Right. So a couple of things that the U.S. President Trump has instructed the ambassador and myself to tell our European allies that we would be in favor of whether you want to call it a Russian oil tariff on China or a Ukrainian victory tariff on China. But our Ukraine, our European allies, have to be willing to follow. We are sitting here during a government shutdown when we can't get seven more Democratic senators across the line. But 8585 U.S. senators are willing to give President Trump the authority to put up to 500% tariffs on China for the purchase of Russian oil. We are told that Ukraine, the European Parliament, will not pass a similar measure. So all I hear from the Europeans is that Putin is coming to Warsaw. There are very few things in life I'm sure about. I'm sure he's not coming to Boston. So we will respond. If are Ukrainian, if our European partners will join us. The second we do have the 20% of we have a 20% phenol tariff on China. And again, they have all but admitted that they sell the precursor drugs. When we have the discussion, they take off the tariff and then we can fix it. We say fix it and show us six months of persistent persistence and then we will take off the tariff. So again, back to the IPR, if 100,000, 200,000 Americans being killed every year by fentanyl families, ruined is not an emergency. I'm not sure what is. And by the way, if the Chinese can cut off rare earths and export control, then they certainly can't control the precursors for fentanyl as well during the process. Very quickly, when the history of this time is written and historians are paying attention to President Trump's decision making surrounding the global tariff program that he has initiated. Can you tell us, to your knowledge, when it was, whether it was during the campaign or the preceding four years or during the transition or since he took office again, that he decided that he was going not only to rely more heavily on tariffs than he did in his first term, but to go as big on tariffs as he has. When was that decision taken? Oh, I think the decision was taken in the first term. And you would have seen President Trump saying that over the past since January 20th, that he would have had a very successful tariff program on China in terms of rebalancing, in terms of purchases that they were supposed to make, which they haven't followed up on. But you you've heard President Trump say that in his in his final year. So trade deals reached with China on January 20th, He was going to expand the tariffs to the world and then COVID hit and out of humanitarian necessity, it would not have been appropriate to start putting on tariffs during a period of such great economic disruption. I had a very powerful meeting immediately after this. All we have time for one question. I'm gonna go do the print folks in the back. Dimitri from the FDA. Thank you, Dmitri. Financial Times and BuzzFeed. I think you said that you don't expect China to implement the reverts regime that it announced. Is that based on something that the Chinese said to you, or if not, what gives you that confidence? And then secondly, if the Chinese were to say we will delay implementation by, let's say, six months or one year, would that be enough for you to delay implementation or imposition of 100% tariffs and other countermeasures? Thank you. So so the Chinese obviously will decide what they're going to do, right? That's not up to me. I'm just outlining our expectation for this program. You know, I see at a minimum, they have to delay it. Our expectation is that this never goes into effect because you can't when you look at what happened with the rare earth magnets, they had a similar program that they implemented. And that program, the result was that they couldn't implement it. They didn't have enough people to organize it, separate and apart from it being just wrong entirely. They actually couldn't implement it, and it took months and months to get the flow of magnets to something that was barely tolerable. Right now, take that program, which was trying to deal with thousands of license applications and multiply it by a thousand. That's what we're talking about because we're not just talking about the rare earths themselves. We're talking about many downstream products that contain those rare earths. Remember, 0.1% of 0.1% of a product to the Chinese rare earth in it. It could be controlled by this. I mean that the scope, the scope and the scale is just unimaginable and it cannot be implemented. And we need to follow up on that. Right now, we are currently in a 90 day roll on the tariffs. So is it possible that we could go to a longer role in return for a delay, perhaps. But, you know, all that's going to be negotiated in the coming weeks before that, before the leaders meet in Korea. Thank you, everybody. With apologies again.