Trump's Economic Advisor: I Don't Think the U.S. and China Will Engage in an Economic War

The senior economic advisor to the U.S. President has suggested that the increase in tariffs on Chinese goods may not actually be implemented and that the two countries might pursue negotiations instead. The United States has imposed billions of dollars in new tariffs on imported goods from China, which was immediately met with retaliation from China. On April 4, the U.S. included about 1,300 imported goods from China in a 25% tariff increase. Within 12 hours of this announcement, Beijing also imposed a 25% tariff on 105 imported goods from the U.S. The tariff increases in each country amount to over $50 billion. These events have reignited discussions and estimates regarding the possibility of an economic war between the two major economic powers. This topic was also raised during a press conference with Larry Kudlow, the senior economic advisor to the U.S. President. In response to a question about whether the announced tariffs might not actually be implemented and could merely be a negotiation tactic, Kudlow replied, 'Yes, that might be the case. This is part of the process.' In an interview with Fox News, Kudlow also stated that he does not believe the recent events constitute a trade war: 'I think there will be tough negotiations between the parties.' Kudlow expressed hope that Washington and Beijing would eventually reach an agreement. However, such optimism is not reflected in the statements of the Chinese ambassador to the United States. According to Reuters, Cui Tiankai, the Chinese ambassador in Washington, had a one-hour meeting with Acting Secretary of State John Sullivan on April 4, and afterward stated, 'Negotiation is what we prioritize, but it is a two-way street. We will see what steps the U.S. takes.' The implementation of the new tariffs and their increases is time-consuming and may take two months or more to be practically enforced. The Associated Press reports that China has not yet announced a specific date for the implementation of the new tariffs. The U.S. has imposed new tariffs on goods such as aerospace products, information technology, telecommunications, and machinery. China has also included soybeans, airplanes, cars, whiskey, and food and chemical products in the new tariffs. China's tariffs could also affect non-American companies that have extensive operations in the U.S. For example, the Associated Press mentions the German car manufacturer BMW, which annually sends nearly 90,000 of its cars from the U.S. to China.