US Treasury Secretary Scott Bessent speaks during the Institute of International Finance (IIF) Global Outlook Forum in Washington, DC on April 23, 2025.
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Treasury Secretary Scott Bessent on Wednesday said that “there is an opportunity for a big deal here” on trade issues between the United States and China.
“If they want to rebalance, let’s do it together,” Bessent said during an appearance at the Institute of International Trade and Finance in Washington, D.C.
“This is an incredible opportunity. I think if Bridgewater founder Ray Dalio were to write something, he could call it a beautiful rebalancing.
Dalio, on April 13, told NBC News that he was worried that President Donald Trump’s tariff and economic policies would threaten the world’s economy, potentially to the point of “something worse than a recession.”
Trump has imposed ultra-high tariffs on China, of 145%. Shortly before Bessent spoke on Wednesday, The Wall Street Journal reported that the Trump administration was considering reducing those tariffs to between 50% and 65%, which would still be extremely high, relatively speaking.
Bessent, in his address to the IITF, outlined what he called “a blueprint to restore equilibrium to the global financial system and the institutions designed to uphold it,” specifically the World Bank and International Monetary Fund.
“The IMF and World Bank have enduring value,” Bessent said. “But mission creep has knocked these institutions off course. We must enact key reforms to ensure the Bretton Woods institutions are serving their stakeholders — not the other way around.”
He said that “Intentional policy choices by other countries have hollowed out America’s manufacturing sector and undermined our critical supply chains, putting our national and economic security at risk.
“President Trump has taken strong action to address these imbalances and the negative impacts they have on Americans.
This status quo of large and persistent imbalances is not sustainable. It is not sustainable for the United States, and ultimately, it is not sustainable for other economies.
Bessent called out the World Bank for lending to nations that have advanced economic growth, including China.
He suggested that the bank stop lending to China.
“The World Bank continues to lend every year to countries that have met the criteria to graduate from World Bank borrowing,” Bessent said.
“There is no justification for this continued lending. It siphons off resources from higher priorities and crowds out the development of private markets. It also disincentivizes countries’ efforts to move away from dependency on the World Bank and toward job-rich, private sector-led growth.”
Bessent added: “Going forward, the Bank must set firm graduation timelines for countries that have long since met the graduation criteria. Treating China — the second-largest economy in the world — as a ‘developing country’ is absurd.
“While it has been at the expense of many Western markets, China’s rise has been rapid and impressive,” he said. “If China wants to play a role in the global economy commensurate with its actual importance, then the country needs to graduate up, we welcome that.”
— CNBC’s Erin Doherty contributed to this story.
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