Trump sugar-coats a trade war with China
- Author: Darren Santiago May 12, 2019,
May 12, 2019, 0:31
USA and Chinese officials are to resume negotiations later on Friday morning for a second day as the world's two largest economies seek to hammer out an agreement.
US President Donald Trump cranked up the heat in a trade battle with China on Friday, ordering a tariff hike on nearly all remaining imports from the world´s second-biggest economy, but Beijing said talks would continue to resolve the row.
Negotiators from the United States and China held their latest round of talks in the U.S. Trade Representative's office in an attempt to end a months-long trade dispute.
Before the latest round of meetings, Liu told Chinese state media he was coming to Washington under pressure but "with sincerity" and warned that a move to raise tariffs by the USA starting Friday was not a solution. "Every country has its principles, and we can not give in".
In fact, tariffs are taxes paid by US importers and often passed along to consumers and companies that rely on imported components.
THE FACTS: In addition to repeating the canard that China pays the tariffs, he's failing to account for the damage that tariffs can do.
"With the over 100 billion dollars in tariffs that we take in, we will buy agricultural products from our great farmers, in larger amounts than China ever did, and ship it to poor & starving countries in the form of humanitarian assistance", Mr Trump wrote on Twitter.
"We believe before we reach a deal, any changes are natural, and inevitable in the whole process", Liu said.
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The latest US increase might hit American consumers harder, said Jake Parker, vice president of the U.S.
Chinese analysts also suggested that China could target the US financial system, the backbone of the US economy, including unloading China's holdings of US Treasury bonds.
White House officials have stressed that both sides were eager to reach a deal.
"Investors are still clinging to the hope that the USA and China will eventually manage to agree some sort of deal", analysts at financial firm Rabobank said in a commentary. The next consultations are set to take place in Beijing, but the timing is not yet clear.
The US President had vowed to impose the mammoth tariffs on all remaining imports from China after a major fallout between the two countries.
Liu did not come prepared to offer much more in the way of concessions, Bloomberg news agency said, quoting several people familiar with the talks.
A tech industry group says tariffs are taxes, and "higher tariffs are only higher taxes", in response to President Donald Trump's decision to increase tariffs on $200 billion worth of Chinese imports to 25%.
China wants tariffs lifted as soon as an agreement is reached, while US officials want to keep them as leverage to ensure compliance.
Trump is fully aware that his trade wars are bad for stocks and generally unpopular.
"If we get to a completed agreement it will have real enforcement provisions", he said at the time.