Trump's auto tariff threat sparks unease with allies, carmakers

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President Donald Trump cast doubt Wednesday on the prospects for talks that are created to head off a trade war between the United States and China.

"Our trade deal with China is moving along nicely, but in the end we will probably have to use a different structure in that this will be too hard to get done and verify after completion", he said.

Trump also reportedly succumbed to pressure from farm-state Republicans, who heavily lobbied the administration to settle its differences with China, which had threatened to levy its own tariffs on American agricultural imports.

Although it offered concessions on lowering tariffs on auto imports and opening its financial markets, China was not forced to fold on some of the most bitter disputes with the United States - on intellectual property, for instance.

China's state media put a positive spin on the outcome, citing an interview with Liu in Washington on Saturday in which he said the sides agreed avoid trade war and "stop slapping tariffs against each other", the Xinhua News Agency said.

"China welcomes the United States in sending senior trade delegations to China soon, and hopes China and the USA can work together to actively implement the measures specified in the joint statement according to the understanding both sides achieved recently in DC", Gao said. "They care about one thing, and that's Made in China 2025". But in a surprise move, USA president Donald Trump tweeted that he plans to intervene to get ZTE back in business due in part to the large number of Chinese jobs on the line.

"Specifically with regard to soybeans, we are hopeful for a solution where Chinese importers can buy USA soy with confidence that there will be no negative impacts from tariffs or other trade barriers".

China would not be able to reach this target by completely new imports but would need to substitute imports from other parts of the world, including the European Union, Japan and Korea, with USA imports, said Alicia Garcia-Herrero, Chief Economist for the Asia Pacific at Natixis, a French corporate and investment bank. Dan DiMicco, a former steel executive who advised Trump during the 2016 presidential campaign, dismissed the truce as "more false promises and delaying tactics".

"A lot of the stories on trade were incorrectly written". In an interview with Bloomberg, Dan DiMicco, the former chief executive of the steel company, Nucor, said it did not "make sense" to have the treasury secretary negotiating trade policy, as this was the United States trade representative's job.

US$50 billion in tariffs on Chinese goods are ready to be enacted at Trump's command
AP US$50 billion in tariffs on Chinese goods are ready to be enacted at Trump's command

Earlier this month, Reuters reported that Ford Motor Co's imported vehicles were being held up at Chinese ports, adding to a growing list of US products facing issues at China's borders.

The president's misgivings open the prospect that a trade war Treasury Secretary Steven Mnuchin had declared "on hold" is at risk of resuming.

US-China Tariff War: To be Continued?

The also a major supplier to China of agricultural products, particularly soybeans and cotton.

Likewise, after Trump signed the Taiwan Travel Act, which encourages official visits between the USA and the island, China staged war games against Taiwan and bribed the Dominican Republic to break diplomatic ties with the Taiwanese government.

To be sure, the United States has long pursued a unilateralist foreign policy, exemplified by George W. Bush's 2003 invasion of Iraq and Barack Obama's 2011 overthrow of Muammar el-Qaddafi's regime in Libya. It followed the Trump administration's proposed duties on more than 1,300 imported products in China's machinery, electronics, aerospace and robotics sectors.

It may be still early days in the US-China trade conflict.

It could raise the costs for overseas automakers to export vehicles and parts to the world's second-largest auto market. He promised to work hard to resolve bilateral trade imbalances and other issues, and announced first-stage tariff reductions on USA auto imports from the current 25 per cent to 15 per cent.

Trump has frequently lambasted China's high import duties on foreign cars.