Trump Says He Loves 'Position We're in' on China Trade Conflict
President Donald Trump started May 13 threatening China that if it retaliates against the latest U.S. Section 301 tariffs, "it will only get worse!" but late in the afternoon reminded White House reporters that he'd be meeting with President Xi Jinping at the G-20, and, he added, "that will be probably a very fruitful meeting."
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Trump did not answer a question about his thoughts on the stock market's reaction to China's hiking some of its retaliatory tariffs in place since September, from 5 percent and 10 percent to 20 percent and 25 percent. The S&P 500 closed down 2.4 percent on the day. But he said, "I love the position we're in." He noted that while China can retaliate, "it can't be very, very substantial by comparison," because the U.S. imports far more from China than it exports to China. He also said, "We have another 325 billion [dollars' worth] we can do if we decide to do it."
China hiked the retaliatory tariffs on some of the $60 billion in U.S. imports it originally targeted in September.
On May 13, the U.S. Trade representative published how interested parties can weigh on on the final tranche of tariffs before a June 17 public hearing.
Trump said to reporters, as he had tweeted earlier, that the China deal was almost complete before the Chinese backtracked. Chinese Vice Premier Liu He, who leads the trade negotiations for China, complained about this characterization on May 11 before leaving Washington after two days of talks, according to the official Chinese state-run news agency Xinhua. "Noting that it is just normal that there have been some ups and downs in bilateral consultations since last year, Liu pointed out that it is irresponsible to casually accuse one party of 'backtracking' while the two sides are still in the process of negotiation."
Liu said China has three areas of disagreement with the U.S. negotiators -- one, that the "amount of purchases should be realistic," and he said China and the U.S. already talked numbers on purchases in talks in Argentina last year, and he characterized U.S. demands for more as a random change. Two, all the Section 301 tariffs should be totally revoked if the countries reach a deal. And third, he characterized China's attempts to change the text as making it more balanced to both sides, and said, "every country has its dignity."
Trump said at the White House that manufacturers who import Chinese inputs should use American parts if they don't want to pay the tariff, or buy it from Vietnam or another country that has lower tariff exposure.
He said at the White House that the U.S. would use some of the billions in revenue coming in from tariffs to compensate farmers who have lost sales to China. "They'll make the same kind of money until such time as it's all straightened out," he said. "I think it's working out very well."