President Donald Trump seemed ready to escalate the trade war with China in an interview with The Wall Street Journal on Monday.
Trump said it was "highly unlikely" that a planned meeting with Chinese President Xi Jinping at the G20 summit would yield a deal to prevent an increase in tariffs.
Trump also said he was prepared to hit another $267 billion worth of Chinese goods with tariffs — which would include duties on consumer goods like iPhones.
President Donald Trump seems ready to escalate the trade war with China even further as a crucial meeting with Chinese President Xi Jinping nears.
In an interview with The Wall Street Journal on Monday, the president said it was "highly unlikely" that the US and China would reach a deal to prevent the 10% tariffs on $200 billion worth of Chinese goods from increasing to 25% on January 1.
In addition, Trump told The Journal that if planned weekend talks with Xi at the G20 summit in Argentina did not go well, more tariffs could be on the way.
"If we don't make a deal, then I'm going to put the $267 billion additional on," Trump said.
Trump first announced tariffs on Chinese goods in March, ostensibly to punish the country for the theft of US intellectual property.
After failed negotiations on a trade deal with China, the first round of tariffs on $50 billion worth of Chinese goods went into effect in July.
A second round of tariffs on another $200 billion of goods went into effect in late September, and Trump has repeatedly threatened to impose a third round on the remaining imports not subject to tariffs.
While Trump said the third round would hit another $267 billion in goods, some reports peg the remaining amount at $257 billion.
After mostly avoiding consumer goods in the first two rounds of tariffs, Trump said he was also willing to place tariffs on items such as Apple's iPhone and laptops imported from China. The administration backed off plans to impose tariffs on some Apple products as part of the previous round after the tech giant lobbied the president.
Economists warn that tariffs on consumer goods would drive up prices for Americans, curtail consumer spending, and eventually hurt US economic growth. Trump disagreed with that assessment, instead suggesting that a low tariff rate on such goods would go unnoticed by consumers.
"I mean, I can make it 10%, and people could stand that very easily," he told The Journal.
In addition to the tariffs, the Trump administration is employing a suite of other measures to crack down on China's economic practices. For instance, the Department of Commerce is considering stricter rules on which types of technology can be exported to China, and the Justice Department has charged some Chinese companies and people with economic espionage.
While there were hopes a Trump-Xi meeting could deescalate the trade tensions, recent moves by the administration seem to point to a sustained trade war.
Perhaps most significant, US Trade Representative Robert Lighthizer last week released an update to the investigation into Chinese intellectual-property theft that kicked off the tariff battle. It found China had not changed any of the practices that precipitated Trump's tariff decision.
Source: Business Insider