China said it is evaluating U.S. overtures to initiate trade negotiations, potentially paving the way for the world’s two largest economies to start talks to resolve a trade war that has rumbled financial markets and cast a pall on global economic activity.

Senior U.S. officials have reached out recently “through relevant parties multiple times,” hoping to start negotiations with China on tariffs, a spokesperson for the commerce ministry said in a statement Friday.

While assessing the possibility of starting any negotiations, Chinese authorities reiterated Beijing’s request for the U.S. to remove all unilateral tariffs. Failure to do so would indicate “an outright lack of sincerity” from Washington and “further compromise mutual trust,” according to a CNBC translation.

“If the U.S. wants to talk, it should show its sincerity and be prepared to correct its wrong practices and cancel the unilateral tariffs,” according to the statement.

U.S. President Donald Trump has slapped tariffs of 145% on imported Chinese goods this year, prompting China to impose retaliatory levies of 125%. So far, both sides have sought to blunt the economic impact of tariffs by granting exemptions on certain critical products.

Chinese offshore yuan strengthened 0.14% to 7.2665 against the U.S. dollar following the statement. While China’s onshore markets are closed for a holiday, Hong Kong’s Hang Seng index jumped 1.6%.

The latest comments from Beijing follow a flurry of conflicting statements from the Trump administration and Chinese leadership on whether talks were underway, with both sides wanting to avoid being seen as the first to back down.

Separately, U.S. Secretary of State Marco Rubio told Fox News’ Hannity Program that the “Chinese want to meet and talk,” according to Reuters, while indicating that such talks will come up soon.

While Beijing appears to signal its readiness to engage in talks with the Trump administration, analysts cautioned that reaching a comprehensive deal will be a complex and time-consuming endeavor.

The wildcard Beijing must contend with before entering any negotiations is the unpredictability of Trump, said Dan Wang, China director at risk consultancy firm Eurasia Group.

“The negotiation is difficult to start because Trump is chaotic. China will not risk losing control of the situation just for the negotiation’s sake,” Wang said.

She anticipates that both sides will only arrange open negotiation after all details are agreed privately. “A more likely scenario is just a long-lasting painful truce with both sides doing their own type of rolling back in practice without backing down politically in public. It can easily last the entire Trump term,” Wang said.

That said, the substance of such talks — if they happen — will also hinge on both sides’ strategic priorities and economic red lines, with both sides showing little appetite for compromise.

“The process is likely to be delicate, as both sides will be reluctant to make concessions on issues they deem vital to their national economic security,” said Alfredo Montufar-Helu, senior advisor to the China Center at think tank The Conference Board.

“One of the major asks of China will be for tariffs to go back to pre-‘liberation day’ levels, at least during the negotiation period. Such a move could provide significant relief to businesses on both sides; however, it remains uncertain how receptive the Trump administration would be to this proposal,” said Montufar-Helu.

U.S. officials, including Treasury Secretary Scott Bessent, have indicated that there could be an easing in tensions with China. Bessent, who has largely backed Trump’s broad tariff scheme, said in a Fox Business Network interview Thursday that U.S.-China tariffs at their current levels are “not sustainable on the Chinese side,” and a “big deal” could be made between the two economies.

“Everything is on the table for the economic relationship. I am confident that the Chinese will want to reach a deal. And as I said, this is going to be a multi-step process,” Bessent said. “First, we need to de-escalate, and then over time, we will start focusing on a larger trade deal.”

In an interview with CNBC on Thursday, White House economic adviser Kevin Hassett said “there have been kind of loose discussions all over both governments,” adding that China’s recent easing of duties on some U.S. products indicated “they were very close to making the kind of progress we need to move the ball forward.”

“We need to look at these exchanges of words with a pinch of salt,” said Tianchen Xu, senior economist at Economist Intelligence Unit, adding that both sides are “waiting for the other side to blink first.”

Xu believes that certain working-level engagements may have already occurred, or are about to occur, which could result in tariff rates being lowered to “less devastating” levels of 40% to 50% over the next one or two quarters.

Trump signed an executive order on Wednesday exempting imported cars and parts from the lofty levies, following the rollback of tariffs on a range of electronic products earlier in April.

According to Reuters, China has also granted tariff waivers on imports of certain U.S. goods, such as pharmaceuticals, aerospace equipment, semiconductors and ethane, while seeking opinion from businesses on items they need to be able to import without paying extra duties.

“Although in practice, the effective tariffs on both sides have gone down, the political stance [from Beijing] has not changed,” Eurasia Group’s Wang said, as Beijing made it clear that the U.S. has to roll back all tariffs for it to participate in any meaningful trade negotiation.

“China is actively managing this decoupling, not taking the bait from the U.S.,” she added.