White House ratchets up trade fight

8 May 2019
120 Views

Prospects for a speedy conclusion to the U.S.-China trade fight dimmed Monday after U.S. officials accused Beijing of reneging on its promises and vowed to implement President Trump’s threat to raise tariffs quickly on Chinese imports.

“Over the course of the last week or so, we’ve seen an erosion in commitments by China, I would say retreating from commitments that have already been made, in our judgment,” said U.S. Trade Representative Robert Lighthizer, declaring tariffs on $200 billion in Chinese imports would rise to 25% starting Friday.

The comments from Mr. Lighthizer, who was joined by Treasury Secretary Steven Mnuchin, followed tweets from President Trump on Sunday that accused China of trying to “renegotiate” and threatened to expand tariffs to cover nearly everything the U.S. imports from China.

Mr. Trump’s threat rattled financial markets around the world, but also triggered speculation that it might be a negotiating tactic aimed at getting the best deal out of Beijing.

While U.S. stocks recoiled sharply Monday morning, they staged a comeback in the afternoon, with the Dow Jones Industrial Average ending the day down 0.3% at close. Mainland China stock exchanges in Shanghai and Shenzhen posted their biggest single-day declines since 2016.

The briefing from Messrs. Lighthizer and Mnuchin, which took place after U.S. markets closed on Monday, made it clear there are deep concerns about the direction of the talks that go beyond negotiating style.

In a show of unity by an administration often divided between trade-friendly officials and China hawks, the two officials were joined at Monday’s briefing by economic adviser Larry Kudlow and trade-and-manufacturing adviser Peter Navarro.

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