On Thursday, President Trump escalated ongoing trade tensions with China by instructing U.S. trade officials to consider tariffs on an additional 100 billion dollars in imports from China, in addition to the tariffs issued earlier this week— totaling 150 billion dollars in Chinese imports across 1,300 categories of products. This action prompted a swift response from the Chinese government, with import levies on American soybeans, cars, chemicals and airplanes. (The Washington Post, April 4)
President Trump escalated ongoing trade tensions with China by instructing U.S. trade officials to consider tariffs on an additional 100 billion dollars in imports from China, in addition to the tariffs issued earlier this week— totaling $150 billion in Chinese imports.
This decision by President Trump comes a month after he authorized levies of 25 percent on imported steel and 10 percent on aluminum, while exempting Canada, Mexico and potentially other countries, based on a country-by-country review of bilateral security agreements. President Trump justified the tariffs by citing alleged violations of U.S. intellectual property laws and unbalanced trade practice. (Roundtable Weekly, March 9)
Roundtable President and CEO Jeffrey DeBoer noted the commercial real estate industry’s concerns, stating, “These proposed tariffs, coupled with the earlier tariffs on steel and ongoing dispute with China could have unfortunate and unintended effects on the U.S. economy by raising construction costs, and reducing jobs in real estate development. China has continually taken advantage of trade practice laws, particularly intellectual property—vital for the U.S. to continue developing new technology, whether it be machinery, software, or energy efficient building solutions and should be held accountable but in a measured way.” (The Washington Post, April 5)
Since the announcement last month, along with the addition of more tariffs this week, U.S. and global market volatility show no signs of letting up, leaving two of the world’s largest economies on the brink of a possible trade war that could negatively impact U.S. agriculture and industry.
Newly appointed National Economic Council Director and Assistant to the President for Economic Policy, Larry Kudlow, said that he expected the U.S. and China to resolve their issues, noting that the announcements by both countries where just “proposals.” (Financial Times, April 5)
Kudlow, who comes to the Trump administration as a former Wall Street economist, CNBC commentator and advocate of free trade, still believes that the U.S. can strike a deal with China—anticipating continued trade will eventually lead to faster growth and higher wages in the U.S. (Politico, April 4; BNA, April 6)
Commerce Secretary Wilbur Ross echoed Kudlow’s reassurance, noting that the U.S. tariffs won’t take effect before the end of May, after a period for public comment, and that the administration may seek to resolve the trade dispute at the bargaining table. The next opportunity for both parties to discuss the ongoing dispute will be later this month at the meeting of the International Monetary Fund and World Bank and in Washington, D.C. (The Washington Post, April 4; Reuters, April 4)