UPDATE 1-Trump ready to meet with China's Xi in South Korea, Bessent tells CNBC

Bessent told CNBC a lower-level Chinese trade official had threatened to "unleash chaos" if the U.S. went ahead with port fees on Chinese ships in August. "There was a lower-level trade person who was slightly unhinged here in August ...

U.S. Treasury Secretary Scott Bessent on Wednesday insisted that Washington did not want to escalate a trade conflict with China, stressing that President Donald Trump is ready to meet Chinese President Xi Jinping in South Korea later this month.

Bessent told a CNBC event that officials from both countries were in touch daily to set up the meeting, and Washington did not want to decouple from the second-largest economy in the world. He said it was due to trust between Trump and Xi that the trade conflict between the two countries has not escalated further.

The two countries appeared poised to return to an all-out trade war late last week, after China on Thursday

announced a major expansion of its rare earths export controls. Trump responded on Friday by threatening to raise tariffs on Chinese goods to triple-digit levels, sending financial markets and U.S.-China relations into a tailspin. Bessent and other officials have sought to get ties back on track in a series of interviews this week. On Wednesday, Bessent said China had clearly intended to take action "all along," rejecting Beijing's claim that the actions were a response to U.S. actions. Bessent told CNBC a lower-level Chinese trade official had threatened to "unleash chaos" if the U.S. went ahead with port fees on Chinese ships in August.

"There was a lower-level trade person who was slightly unhinged here in August ... saying that China would unleash chaos on the global system if the U.S. went ahead with our docking fees for Chinese ships," Bessent said.