With tariff tensions rising between USA and China President Trump doesn’t seem to take a backseat. The situation has been escalating for the last 6 months. It all started in January 2018 when President Trump imposed a 25% tariff on Chinese imports to the USA worth $34 Billion. President Trump followed with threatening to impose another 10% tariff on another $200 billion worth of Chinese goods.
The tensions escalated when Robert Lighthizer, the US Trade Representative told the media on 2nd August 2018 that Trump ordered the USTR’s office to examine a possibility of putting a 25% tariff on Chinese imports worth $200 billion. China responded on 3rd August with a threat to slap USA’s exports to China worth $60 billion with a tariff ranging from 5% to 25%.
If China goes forward with the decision almost 90% of the USA’s exports to China will be subjected to the tariff. While talking to Bloomberg TV President Trump’s chief economic advisor Larry Kudlow said “Don’t underestimate President Trump’s determination to follow through” while talking about tariffs on Chinese goods.
According to Kudlow who is also a renowned Wall Street economist, the tariff talks with the Chinese are on a halt for last 6 weeks. One of the reasons for no dialogue between USA and China on this matter is that the President Trump’s administration still doesn’t know what to achieve through this trade war.
According to Forbes writer Kenneth Rapoza, China may retaliate with blocking US companies to operate in their country. If Trump moves forward with this war. Looks like Trump is really happy with his tariff policy as he tweeted on Sunday “Tariffs are working big time”. We need to wait and see for the long-term results of this trade war between the two biggest economies of the world.