U.S. defends trade barriers as Davos readies for Trump
The United States is committed to free and fair trade while bracing itself for possible retaliation from China over new tariffs, top U.S. Cabinet members said Wednesday, ahead of a much-ballyhooed visit by President Donald Trump to the World Economic Forum in Davos, Switzerland.
Days after Trump backed new tariffs on imported solar-energy components and large washing machines, his combative commerce secretary, Wilbur Ross, conceded that China could respond by imposing its own tariffs on U.S. products.
“In terms of any trade action you take, there’s always potential for retribution or retaliation and that’s up to the Chinese to decide,” Ross told journalists Wednesday as part of the largestever U.S. delegation to the annual Davos gathering of business and political leaders.
Ross insisted that the U.S. government is not protectionist and that the tariffs are meant to deal with what he termed “inappropriate behaviour” by other countries.
Many in the Trump administration think that much of the global trading system is rigged against the U.S. and that many countries have not been playing fair, using unfair methods to gain a competitive advantage.
“Trade wars are fought every single day,” Ross added. “Unfortunately, every single day there are various parties trying to violate the rules, and trying to take unfair advantage of things ... the difference is that U.S. troops are now coming to the rampart.”
Ross said it wasn’t for him to set Chinese policy about whether to retaliate or not but he warned that if Beijing were to do so, there would be a question as to what the U.S. in turn would do.
The “America First” strategy that helped Trump win the presidency is partly a reflection of dealing with that apparent rigged system.
It’s already seen the U.S. withdraw from the Trans- Pacific Partnership, a trade deal with 11 countries, and seek a renegotiation of the North American Free Trade Agreement with Canada and Mexico. Trump has also pulled the United States out of the Paris agreement on climate change, a move that reinforced fears that “America First” means the U.S. turns inward and opts for a more isolationist approach.
German Chancellor Angela Merkel said there is too much “national egoism” at the moment and that the World Economic Forum’s motto of “creating a shared future in a fractured world” was “exactly right” for 2018.
“We believe that isolationism won’t take us forward,” she said. “We believe that we must cooperate, that protectionism is not the correct answer.”
Trump is due to address the Davos forum Friday and there’s been concern among some participants about what his economic and trade policies could do to the global economy.