Trump sees trade deal with 'friend' Xi

Grant Boone
April 9, 2018

A deal addressing China's theft of USA intellectual property is also expected to be made.

Despite the ongoing dispute, the US President today insisted that a deal on intellectual property with China would mean a "great future for both countries".

In a hastily arranged press conference held just before United States markets opened on Friday morning, a Chinese commerce ministry spokesman vowed that "under this backdrop [of USA threats] China will not negotiate". "Trump's protectionist policies will be a short wave in the long history of world trade".

"The same sort of strategic resolve that China had in the Korean war is being built up across the country to beat the Trump administration's trade attack", it said in an editorial on Saturday.

In addition to threatening penalties on American goods, China has also asked the business community in the United States and elsewhere to protest the planned Trump tariffs.

China shot back 11 hours later with a list of proposed duties on $50 billion of American imports, including soybeans, aircraft, cars, beef and chemicals. Beijing also declared that the current rhetoric made negotiations impossible, even as the White House suggested that the tariff talk is a way to spur China to the bargaining table.

Top members of Trump's economic team, speaking on Sunday morning talk shows, defended the USA threats to impose tariffs on Chinese imports and framed the moves as part of a longer-term strategy for growth - while suggesting a trade war can be averted. He also said that though the United States hoped to avoid taking action, Trump "was not bluffing".

"No president has had the backbone to take it up publicly before", Larry Kudlow, the new chairman of the National Economic Council, 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. "We don't want a trade war, but we aren't afraid of fighting one", said the ministry statement.

Treasury Secretary Steven Mnuchin declined to comment on the substance of trade talks with China during an interview on CBS' "Face The Nation".

He said he did not think there will be a trade war.

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White House trade adviser Peter Navarro told NBC's Meet The Press that "we're moving forward in a measured way".

Trump's latest proposal intensified what was already shaping up to be the biggest trade battle in more than a half century.

On Thursday, he asked the US ambassador to China to consider more tariffs on $100 billion that the country exports. Rather than waiting weeks for the USA tariffs to be implemented, Trump backed a plan by Robert Lighthizer, his trade representative, to seek the enhanced tariffs. But he defended Trump's plans as a sound long-term strategy.

"The United States hasn't had a Trade Surplus with China in 40 years", the president said.

Further escalation could be in the offing.

Communist Party mouthpiece People's Daily quoted Ministry of Commerce researcher Zhou Mi as saying the U.S. had abused national security reviews to block Chinese investment in the USA and the administration's intervention had become "increasingly frequent and direct".

For Trump, the dispute runs the risk of blunting the economic benefits of his tax overhaul, which is at the center of congressional Republicans' case for voters to keep them in power in the 2018 elections.

Chinese workers stand in front of a loaded cargo ship docked at a port in Qingdao in east China's Shandong province on Sunday.

So far, only the tariffs on steel and aluminium have taken effect.

Crude oil and global equity markets tumbled on Friday on investor worries about the impact a tariff war could have on the world economy.

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