IMF: Tar­iffs on China won’t have much ef­fect

Lodi News-Sentinel - - NATION / WORLD - By Mark Boc­chetti

WASH­ING­TON — China ap­pears able to bear the cost of the Trump ad­min­is­tra­tion’s tar­iffs on im­ports, with lit­tle evidence of an eco­nomic slow­down, ac­cord­ing to a sur­vey by the In­ter­na­tional Mon­e­tary Fund.

The IMF found that the U.S. tar­iffs so far on im­ports from China would shave only about 0.2% from growth, fore­cast­ing GDP growth of 6.2% in 2019. The strength of China’s econ­omy and the gov­ern­ment’s abil­ity to re­spond to the tar­iffs may call into ques­tion Pres­i­dent Don­ald Trump’s as­ser­tion that China would be hurt by the levies.

Ken­neth Kang, a deputy di­rec­tor in the Fund’s Asia and Pa­cific de­part­ment, said China’s ef­forts to pro­vide eco­nomic stim­u­lus to off­set the im­pact of 25% tar­iffs have been suc­cess­ful. He said that if tar­iffs re­main at cur­rent lev­els, no fur­ther stim­u­lus would be nec­es­sary to keep growth in the tar­geted range.

Kang spoke at a press con­fer­ence in Bei­jing in Wed­nes­day. A tran­script was made available Thurs­day.

“If trade ten­sions es­ca­late, for ex­am­ple, if U.S. were to im­pose additional tar­iffs, it’s true that growth could be sig­nif­i­cantly af­fected,” Kang said. “And in this sit­u­a­tion some tem­po­rary stim­u­lus could be ap­pro­pri­ate.”

The ad­min­is­tra­tion im­posed tar­iffs of 25% on some $50 bil­lion of China-ori­gin im­ports in mid-2018, and it in­creased the pres­sure with a 10% tar­iff on an additional $200 bil­lion in im­ports in Septem­ber of last year. The U.S. raised the 10% to 25% in midMay in re­sponse to al­leged back­track­ing by China in ne­go­ti­a­tions.

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