US Treasury Secretary Scott Bessent told Bloomberg Television on Thursday that Russia’s willingness to negotiate an end to the war in Ukraine could lead to Washington easing some sanctions.
Bessent further stated that he would be urging China to rebalance its economy towards increased consumer spending in a meeting with his Chinese counterpart on Friday.
Bessent was asked if the US was open to adjusting sanctions on Russia, either increasing or decreasing them, based on the outcome of negotiations to end the Ukraine war.
He responded that this would be an accurate way to describe the situation.
He added:
The president is committed to ending this conflict very quickly.
Russia-Ukraine conundrum
US President Donald Trump said that he might meet with Russian President Vladimir Putin this month to discuss ways to end the war.
Bessent in the interview declined to give a specific date for a Trump-Putin meeting but confirmed that he would not be attending the G20 finance ministers and central bank governors meeting in South Africa next week.
He cited domestic considerations as the reason for his absence.
Bessent said during his US Senate confirmation hearing that if Trump asked, he would support increasing sanctions against Russian energy companies, particularly oil majors.
The Treasury chief condemned Ukrainian President Volodymyr Zelenskiy for not signing a $500 billion agreement to supply the US with critical minerals and for escalating a war of words with Trump.
The US president had also called Zelenskiy a “dictator.”
Bessent expressed disappointment that Zelenskiy had not yet signed the minerals deal, despite his assurances earlier.
He described the minerals supply arrangement as a component of a sophisticated strategy to strengthen ties between Ukraine and the US.
Zelenskiy rejected US demands on Wednesday, stating that Washington had not provided anywhere near the amount of war aid in question, nor had it offered specific security guarantees in the agreement.
The US had demanded that Ukraine repay Washington for wartime aid with mineral wealth.
Bessent’s stance on China
Bessent stated that he would push for economic reforms to boost domestic consumption during his initial conversation with his Chinese counterpart.
The US will initiate a video call with China’s Vice Premier He Lifeng to discuss important economic issues between the two countries. The call will take place on Friday and He Lifeng will speak with Bessent, according to the report.
Bessent’s predecessor, Janet Yellen and many other US Treasury secretaries have repeatedly argued that China should reduce its reliance on exports for economic growth.
Despite these recommendations, China has persisted with its investment and export-oriented strategies.
“The Chinese need to rebalance their economy in favor of consumption – that they are suppressing the consumer in favor of the business community,” Bessent said.
Debt issuances
Bessent stated that given obstacles such as the Federal Reserve’s quantitative tightening program, any move to increase the proportion of longer-term Treasuries in government debt issuance will not happen soon.
Bessent criticized Yellen’s frequent issuance of shorter-term bills during Trump’s election campaign.
He contended that this strategy, which Yellen denied, was intended to stimulate short-term growth by taking advantage of the typically lower interest rates associated with shorter-term bills.
Bessent, when asked about shifting to longer-term issuance, said that it’s too far off to tell and that they’re going to see what the market wants.
It’s going to be path dependent.
The report added that he dismissed speculation that the US government might revalue its gold holdings to reduce borrowing needs or to fund the creation of a sovereign wealth fund.
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