Source:
https://scmp.com/news/china/diplomacy/article/3010048/donald-trump-warns-china-it-will-be-hurt-very-badly-if-it
China/ Diplomacy

Donald Trump warns China it will be ‘hurt very badly’ if it doesn’t reach a trade deal quickly

  • US President’s latest flurry of tweets includes warning to Beijing not to retaliate after he raised tariffs on Chinese imports
  • Trump dismisses concerns that American consumers will pay more, arguing businesses can buy from ‘non-tariffed countries’ instead
Donald Trump recently accused China of trying to alter the terms of the deal between the two sides. Photo: Reuters

US President Donald Trump has warned China not to retaliate after his latest salvoes in the ongoing trade war, arguing that things “will only get worse” if it does.

In a series of tweets on Monday morning, Trump also said China risked being “hurt very badly” and dismissed concerns – articulated by his own economic adviser among others – that American consumers would pay as a result of his decision to increase tariffs on Chinese imports.

The US raised tariffs on US$200 billion of Chinese imports from 10 per cent to 25 per cent on Friday – a move Trump defended on the grounds that China “has taken advantage of the US for so many years”.

The US President had previously accused China of trying to change the terms of the agreement between the two sides.

In his latest tweets he warned: “China should not retaliate – will only get worse!

“I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don’t make a deal because companies will be forced to leave China for other countries. Too expensive to buy in China. You had a great deal, almost completed, & you backed out!”

He also defended the increase in tariffs by insisting: “Their [sic] is no reason for the U.S. Consumer to pay the Tariffs, which take effect on China today. This has been proven recently when only 4 points were paid by the US, 21 points by China because China subsidises product to such a large degree.

“Also, the Tariffs can be completely avoided if you by from a non-Tariffed Country, or you buy the product inside the USA (the best idea). That’s Zero Tariffs. Many Tariffed companies will be leaving China for Vietnam and other such countries in Asia. That’s why China wants to make a deal so badly!”

Trump’s tweets contradict a general consensus among economists that higher tariffs will have an impact on US consumers and White House economic adviser Larry Kudlow recently conceded that both Chinese and American businesses and consumers would pay.

“In fact, both sides will pay. Both sides will pay in these things,” Kudlow said, but he added that China will suffer economic losses from reduced exports to the US.

On Friday, the Office of the United States Trade Representative (USTR) issued a notice confirming the tariff increase to 25 per cent, but also saying that the president had “ordered us to begin the process of raising tariffs on essentially all remaining imports from China, which are valued at around US$300 billion”.

“The process for public notice and comment will be published soon in the Federal Register. The details will be on the USTR website on Monday as we begin the process before a final decision on these tariffs,” read the note.