Trump calls China trade war ‘little squabble’ but says more tariffs possible

US president again suggests that US holds stronger hand in negotiations with Beijing

US president Donald Trump speaks to reporters before departing the White House on Tuesday: he said the US were in a very, very strong position in the escalating trade war with China. Photograph: Tom Brenner/The New York Times

US president Donald Trump speaks to reporters before departing the White House on Tuesday: he said the US were in a very, very strong position in the escalating trade war with China. Photograph: Tom Brenner/The New York Times

 

US president Donald Trump dismissed the deepening trade war with China as a “little squabble”, as he reiterated threats to place tariffs on an extra $325 billion (€290 billion) of Chinese exports.

“I think it’s going to turn out extremely well; we’re [in] a very strong position,” he told reporters as he left Washington for an event in Louisiana.

“We’ve been losing, for many years, anywhere from $300 billion to $500 billion a year with China and trade with China. We can’t let that happen,” he added, describing the United States as the “piggy bank that everybody like to take advantage of”.

Mr Trump again suggested that the United States held the stronger hand in negotiations with Beijing. “We are, again, in a very, very strong position. They want to make a deal,” he said. “Our economy is fantastic; theirs is not so good. We’ve gone up trillions and trillions of dollars since the election; they’ve gone way down since my election.”

Trade imbalance

He added: “You want to know something? We always win.”

Earlier in the day he suggested on Twitter that the Federal Reserve – a frequent target of criticism from the president – could play a role in addressing the trade imbalance if it undertook stimulus moves similar to those in the Chinese economy.

“China will be pumping money into their system and probably reducing interest rates, as always, in order to make up for the business they are, and will be, losing,” he tweeted. “If the Federal Reserve ever did a ‘match’, it would be game over, we win! In any event, China wants a deal!”

Stock markets recovered somewhat on Tuesday after a tumultuous week after trade negotiations between the United States and China stumbled without reaching a conclusion.

The United States raised tariffs on $200 billion (€178.4 billion) of Chinese exports on Friday while Beijing responded on Monday by announcing tariffs on $60 billion (€53.5 billion) worth of US goods which will go into effect on June 1st.

Beijing rejected reports that it was to blame for the breakdown in talks last week in Washington. The foreign ministry said that America had changed its demands at the last minute, requesting that Beijing increase the volume of goods it had agreed to buy from the United States.

Upbeat assessment

Mr Trump’s upbeat assessment came amid reports that the White House is considering a new bailout package for farmers affected by the trade war. It comes less than a year since the administration introduced a $12 billion (€10.7 billion) financial aid package for farmers to help exporters hit by Chinese retaliatory measures after an earlier round of US tariffs.

The US president was also asked about a New York Times report that the White House is considering sending 120,000 troops to the Middle East as it eyes a possible threat from Iran. Mr Trump dismissed the story as “fake news”, though added that he would be prepared to send “a hell of a lot more” than that.

“I think it’s fake news, okay?” he said to reporters, but added: “Now, would I do that? Absolutely. But we have not planned for that. Hopefully we’re not going to have to plan for that. And if we did that, we’d send a hell of a lot more troops than that.”

Tensions between Tehran and Washington have deepened since the Trump administration pulled out of the 2015 Iran nuclear deal. Last month the administration tightened further restrictions it put on Iran’s trade with other countries.

Several vessels have been attacked near Iran in recent days, while Saudi Arabia announced on Tuesday that two of its oil stations had been hit by drone attacks. Yemeni Houthi rebels aligned with Iran claimed responsibility for the attack.

Speaking in the Oval Office on Monday, Mr Trump warned Iran against any provocations in the area. “If they do anything, it will be a very bad mistake,” he said.