Despite the U.S. Government’s postponement of new punitive tariffs, no agreement is in sight in the trade war with china. The people’s republic has made no new concessions in the youngest languages, said u.S. Secretary of commerce wilbur ross.
The postponement of some penalties until december is only due to concerns about the christmas trade in the USA, ross said in an interview with CNBC. President donald trump’s trade adviser, peter navarro, said to be prepared for long negotiations. Meanwhile, the U.S. Stock market fell sharply – also because of warning signals on the bond market.
Navarro, who is considered very influential, told the news channel fox business that the president would not accept a half-baked compromise in the negotiations with china. What is needed are deep, structural and verifiable changes. "You can’t meet the chinese halay," navarro said. Were they to do so, they would still "steal half as much as they steal now and kill half as many americans," navarro said, referring to the trade deficit and the ongoing smuggling of the drug fentanyl from china.
Navarro admitted that the trade conflict, which has been going on for a year now, would have a long-term impact on the global economy. "If we don’t get structural changes in china, the global economy will miss a great opportunity for further growth," he told fox business. Negotiators from both sides planned to talk again on the phone in the next two weeks, navarro said. Commerce secretary ross, in turn, said there was no date yet for the round of negotiations originally scheduled for september in washington.
The trade war is already weighing on the economic outlook. After warning signals from the U.S. Bond market, the new york leading dow jones index temporarily fell by just over 700 points, or almost three percent, by early afternoon (local time) to 25.549 points down. The nasdaq technology index also fell by a good three percent at times.
Bond market developments interpreted by some analysts as signs of impending recession. Presidential advisor navarro, however, rejected this interpretation. The volatility on the stock market only suggests that the u.S. Central bank had to cut the key interest rate by half a percent, he said. The federal reserve cut its key interest rate in july for the first time since 2008, partly because of the impact of the trade disputes on the economy.
The U.S. Government on tuesday unexpectedly postponed part of the new 10 percent tariff on imports worth a total of 300 billion U.S. Dollars that trump announced in early august. Numerous consumer goods – including smartphones, laptops, sneakers and toys – are not to be taxed until 15. December sanctions imposed so as not to jeopardize christmas shopping season. According to u.S. Media reports, the now-exempted imports are worth at least 100 billion u.S. Dollars.
The tariffs were originally scheduled to take effect in september. Previously imposed tariffs of 25 percent on imports worth about 250 billion U.S. Dollars remain in place. This means that from mid-december almost all chinese imports into the US will be subject to punitive tariffs.
Beijing and washington negotiators last spoke by phone on tuesday. Trump said recent talks have been "very productive". China desperate for trade agreement, he said. The previous round of talks between the two countries in july had ended without any concrete result, after which trump announced the new punitive measures. Trump is sure to keep up the pressure in the future, pushing for a quick deal with beijing. He fears the chinese are playing for time in view of next year’s u.S. Election. Won’t stand for it.
The trade war was originally sparked by trump’s annoyance that china exports far more to the U.S. Than vice versa. U.S. President calls for removal of market barriers, criticizes copyright infringement and forced technology transfer at U.S. Companies operating in china.