Trump renews trade war as China talks end without deal
Trade talks between China and the United States ended Friday without a deal as President Donald Trump raised tariffs on $200 billion worth of Chinese imports and signaled he was prepared for a prolonged economic fight.
Trump, who only weeks ago predicted a signing ceremony for an “epic” trade deal with President Xi Jinping of China, reclaimed his stance of threateconomies ening Beijing and insisting his approach would help the U.S. economy. In a flurry of tweets Friday, Trump warned that he would tax nearly all of China’s imports if the country continued to backtrack on a trade deal.
“Tariffs will make our Country MUCH STRONGER, not weaker. Just sit back and watch!” Trump said Friday morning, adding that the Chinese “should not renegotiate deals with the U.S. at the last minute.”
The toughened stance has thrust the world’s two largest back into a trade war that one week ago had seemed on the cusp of ending. Talks between the United States and China suffered a setback over the weekend, when Trump and his advisers were surprised by what they saw as China’s attempt to renege on parts of an emerging trade deal. Trump is now moving ahead with plans to impose 25% tariffs on all remaining Chinese imports. Those new tariffs could go into effect in a matter of weeks.
In a statement Friday evening, the U.S. trade representative said Trump had “ordered us to begin the process of raising tariffs on essentially all remaining imports from China, which are valued at approximately $300 billion.”
On Friday afternoon, Trump suggested that the ball was in Beijing’s court, saying, “The United States has imposed Tariffs on China, which may or may not be removed depending on what happens with respect to future negotiations!”
Both sides had agreed to meet again in Washington on Thursday and Friday, but the talks were brief and focused mostly on the roots of the recent impasse. By early afternoon Friday, the meeting had concluded, and no further faceto-face negotiations were scheduled. Trump called the
discussions “candid and constructive,” and China’s vice premier, Liu He, said the talks went “fairly well.” An administration official said it was possible that the negotiators could reconvene in June in Beijing.
Stock markets fell in early morning trading but regained ground after Trump’s comments.
It remains unclear whether the two countries can salvage a trade agreement that is complicated by political dynamics on both sides of the Pacific. Trump, who has promised to be tough on China, is eager to avoid being seen as signing a weak deal that does not take advantage of the leverage the United States has created with its tariffs. But Xi is also facing pressure from hard-liners in China, who do not want to acquiesce to the United States, particularly Washington’s demands that China make changes to its laws.
On Friday, the trade dispute appeared to be lurching toward an all-out economic war. China has threatened to retaliate with its own “countermeasures,” which include ending purchases of American farm goods and establishing other nontariff barriers for companies trying to gain access to the Chinese market.
Trump continued to insist that his tough approach would benefit the U.S. economy, particularly farmers, who have faced retaliation from China as a result of the trade war. But the president suggested he would once again try to insulate farmers, many of whom support his presidency, from additional pain through another round of financial support. The administration previously created a $12 billion aid program to help compensate farmers for traderelated losses.
Chinese officials said the decision to come to the United States after Trump’s tariff threat was intended to show they are serious about continuing discussions. But it is unclear whether China is willing to make the changes that the Trump administration is demanding, including codifying much of the emerging agreement into law. Trump’s advisers want to ensure China does not violate an agreement that is aimed at giving American companies greater access to China’s market and ensuring protections for their technology and trade secrets.
“I come here facing pressure,” Liu said Thursday in an interview with China Central Television in Washington. “That expresses China’s greatest sincerity. And we want to resolve some of the differences we face honestly, confidently and rationally. I think there is hope.”
China has yet to specify the countermeasures it plans to take, but the administration signaled this week that it expected farmers to once again bear the brunt of any retaliation.
Trump suggested Friday that the United States would use the tariff money it collects to buy American farm products, which it would then ship to “poor & starving countries in the form of humanitarian assistance. In the meantime we will continue to negotiate with China in the hopes that they do not again try to redo deal!”
Other administration officials suggested some type of aid program was in the works but did not expand on Trump’s idea.
“Make no mistake about it, we have already had preliminary discussions in the White House for additional support for farmers if this impasse with China continues,” Vice President Mike Pence said in remarks Thursday in Minnesota.
Sonny Perdue, the agriculture secretary, said Friday that he had spoken to Trump, who directed him to develop a new plan to support farmers. Perdue said on Twitter that Trump “loves his farmers and will not let them down!”
Economists have criticized aid to farmers as less effective than opening up overseas markets. They have also almost uniformly rejected the president’s arguments that tariffs are good for the United States, saying that these taxes reduce economic activity by raising prices for consumers.
The United States and China had been nearing a trade deal that would lift tariffs, open the Chinese market to American companies and strengthen China’s intellectual property protections. But discussions fell apart last weekend, when China called for substantial changes to the negotiating text that both countries had been using as a blueprint for a sweeping trade pact.
A container ship is unloaded Friday at the Virginia International Gateway terminal in Norfolk. President Donald Trump’s latest tariff increase on Chinese goods took effect Friday, and Beijing said it would retaliate.