Speaking at the White House NAFTA press conference on Monday, President Donald Trump says the United States is not yet ready to have a deal with China, although China wants it badly.
The new North American Free Trade Agreement with Canada and Mexico sends a powerful message to China – which is starting to show the strains of the deepening tariff war – that the president’s actions are more important than his words, according to Financial Review.
“China wants to talk, very badly, and I said frankly it’s too early to talk. We can’t talk now, because it’s not ready,” said Trump, “They have been ripping us off for so many years. It doesn’t happen that quickly. And if politically people force it too quickly, you are not going to make the right deal for our workers and for our country.”
“We have US$ 250 billion at 25% interest with China right now. And we can go to US$267 billion more”; “Because of the power of tariffs we have, we in many cases don’t have to use them. That’s how powerful they are, and how good they are, ” Trump says at the press conference.
According to JPMorgan, as the White House refuses to let up on its protectionist trade policy, one team of analysts on the Street expects trade tensions to lead to higher U.S. tariffs on all Chinese imports.
“JPMorgan has adopted a new baseline that assumes a U.S.-China endgame involving 25% U.S. tariffs on all Chinese goods in 2019,” wrote JPMorgan analyst John Normand. “A weaker yuan becomes part of the new equilibrium.”
But Donald Trump says he is open to dialogues. “China wants to talk and we want to talk to them. We want them to help us with North Korea. We want them to continue to help us in North Korea, that’s very important.”
Taking questions about trade, Trump says he just wants a fair deal, “We have lost 375 billion dollars in trade deficits (with China). They have a surplus of 275 billion dollars with the United States, and it’s been that way for years and years. We rebuild China. They took the money, and they build fighter jets, bridges, more bridges than we did in the last 100 years, big ones, like George Washington Bridge.”
“I don’t blame China, I blame our leadership. They should have never let that happen,” Trump added.
Trump says that he once talked to a high representative (did not mention his name) from China and asked him, “How could this have happened?” This Beijing official said, “No one has ever done anything from the United States. When we put on 25% on every car that is coming from the US into China, we thought it would be rebuked, but nobody ever called.”
Trump told the audience at the White House, “We don’t have a deal with China, they do what they want. We have a tremendous problem with intellectual property with China. We have lots of other problems with China… They have a difficult time now, I don’t want them to have a difficult time.”
We see tensions now between Washington and Beijing have been on the rise in recent weeks as the two sides battle it out over a wide range of issues, and into the military.
Last week US Secretary of Defense James Mattis cancelled a planned visit to Beijing with his counterpart later in October to discuss security issues.
According to CNN yesterday, a US Navy ship had an “unsafe” interaction with a Chinese warship Sunday while the US vessel was conducting a freedom of navigation operation near the disputed Spratly Islands in the South China Sea, causing the US ship to maneuver “to prevent a collision,” according to US defense officials.
Earlier in August the US sent bombers through the East and South China Sea four times.
China criticised the flights, calling them “provocative” and threatening to “take necessary measures’ to defend its national interests. In response, the Chinese military conducted “live fire shooting drills” in the South China Sea this past weekend in a show of force.
As the economy slows down and wrestling among different forces within the government intensifies, the conditions in China is going to get nasty in the coming weeks, apart from complexities and uncertainties overseas in a united front to counter their homeland regime.
By Cloudy Seagail