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Washington - President Donald Trump vowed that China will relax its trade restrictions in response to US pressure “because it’s the right thing to do,” as the world’s two largest economies teeter on the brink of a trade war that’s unsettled global financial markets and sent the US stock market reeling.
“China will take down its Trade Barriers because it is the right thing to do,” Trump said on Twitter early Sunday. “Taxes will become reciprocal & a deal will be made on Intellectual Property.”
The president commented ahead of several appearances by top members of his economic team, who are expected to defend the US threats to impose tariffs on Chinese imports and frame the moves as part of a longer-term strategy for growth.
“I think it’s going to generate very positive results which will grow” the economies of the US, China, and the world, Larry Kudlow, Trump’s top economic adviser, said on CNN’s “State of the Union".
Kudlow said while he would support imposing tariffs if negotiations with China fail, nothing has happened yet. In a separate interview on “Fox News Sunday,” Kudlow acknowledged “jitters” but insisted “we’re not gonna to end up in a trade war.”
Last week brought an escalation of the dispute, when Trump on April 5 instructed the U.S. Trade Representative’s office to consider tariffs on an additional $100 billion in Chinese imports. That raised the total to $150 billion of Chinese goods under consideration.
A Little pain
China, which already proposed duties on $50bn in US products including aircraft to soybeans, has threatened to respond proportionately and “counterattack with great strength” if Trump makes good on the latest tariff proposal.
The escalation in tensions pushed the S&P 500 Index down sharply; it lost 1.4% on the week after several days of wild swings. The gains in U.S. equities since Trump became president - which Trump and his team have hailed for months - have eroded.
Trump on Friday acknowledged there could be “ a little pain” ahead for the U.S., while emphasising his goal is to ensure the US emerges a much stronger country in the end.
On Friday Kudlow said that the US and China are holding “back-channel discussions” to resolve the escalating trade dispute.
Still, White House trade advisor Peter Navarro said the threat of tariffs is not merely a negotiating tactic with China. “We’re moving forward in a measured way,” he said on NBC’s “Meet the Press.”
Navarro said Friday that high-level talks will take place before any tariffs will take effect, led by Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer.
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