Economy

Trump's No-Lose Trade War Fantasy

Trump's No-Lose Trade War Fantasy”

The Wall Street Journal reported on Thursday that Beijing and Washington were working on a plan to postpone until April tariff increases on Chinese imports, scheduled to be imposed on January 1, to allow time for further talks.

Trump railed against the massive US trade deficit with China during his 2016 election campaign and after a year in office, with no sign of the gap narrowing, the USA president attacked the issue head-on. The latter, while quite possible considering the track record of the White House, seems unlikely to succeed.

There is little reason to be optimistic about the outcome of the dinner between Xi Jinping.and Donald Trump. But Trump escalated tensions earlier in the week, when he repeated a threat to put tariffs on the remaining Chinese goods if a deal can't be reached.

Mr Trump told reporters before departing the White House on Thursday: "I think we're very close to doing something with China but I don't know that I want to do it".

"Asian markets didn't need to be told twice that Larry Kudlow considers a trade deal between the USA and China an open possibility", Jasper Lawler, head of research at London Capital Group said on Wednesday morning. One offer, according to Chinese officials: in return for the suspension of US tariffs, Beijing would agree to lift restrictions on China's purchases of USA farm and energy products. That's changing thanks to Trump's tariffs, with Chinese importers looking elsewhere for a plentiful supply.

The president has pledged to reduce America's trade deficit by pursuing new trade agreements with countries he argues are engaging in unfair trade policies, especially China.

"The Hundred-Year Marathon" author Michael Pillsbury on the Trump administration's trade negotiations with China. "I beat the people from China".

"All of us being here is a way to anchor the energy of this place, which we need so much", she said. DW examines the best quotes uttered by the USA president concerning the People's Republic of China.

In the G20 context, that parallels controversies pitting Beijing against other nations over the passage of ships through the South China Sea, a vital trading artery.

This is because China's existing $113bn tariffs on United States goods are not far from the $130bn it imported from the U.S. in 2017. They are, of course, ultimately a tax on USA consumers and shareholders.

U.S. Trade Representative Robert Lighthizer said Wednesday the country will consider raising tariffs on Chinese automobiles to 40 percent from the current 27.5 percent, ahead of a U.S.

The tariffs are having an impact in the US.

The president criticized General Motors this week for announcing layoffs at factories in the US, saying the automaker should have closed plants in China or Mexico instead. A final decision on the proposed arrangement would reportedly not be decided until then. "And it is willing to cooperate with Washington in dealing with concerns about trade if they are fair-minded", the paper said. They will also talk about macroeconomic policy, the digital economy, reform of the World Trade Organization, financial regulation, taxation and trade issues. "In this respect, Presidents Xi and Trump are under pressure to find compromises and make progress towards ending the trade dispute", Cheng Li, a senior fellow at the Brookings Institution, told DW.

"China should change its practices and come into the community of responsible trading nations", Kudlow said, stressing that he considers the U.S. economy in far better shape than China's to weather a prolonged trade war.



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