Exclusive: Trump will 'terminate' China trade deal, 'charge tremendous tariffs' if Xi breaks rules

'China has a reputation for being cute... but I have a great relationship with President Xi'

President Trump said he and China’s Xi Jinping are “getting along,” but he’s not afraid to ax the phase one portion of the U.S.-China trade deal and slap additional tariffs on the nation if it breaks trade promises.

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Trump, during an exclusive interview with FOX Business’ Maria Bartiromo at the World Economic Forum in Davos, said he’s fully aware that China hasn’t been trustworthy in the past, but phase one has a “tremendous policing action” that’s the “strongest anyone’s ever had,” and if China steals intellectual property, he will “terminate the deal” and “charge tremendous tariffs.”

CHINA WILL 'CERTAINLY' HONOR PHASE ONE TRADE PROMISES, BLACKSTONE'S SCHWARZMAN SAYS

“China has a reputation for being cute,” added Trump. “But I have a great relationship with President Xi – I don’t think it’s going to happen.”

Though not included in the deal, Trump believes that pressure to shut down the illicit supply of fentanyl, a dangerous drug similar to morphine involved in overdose deaths in the U.S., is having a “big impact.”

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“I said [to Xi] you’ve got to do me a favor – you’ve got to stop the fentanyl,” said Trump, and he added that now China is placing criminal penalties on the drug, “which they’ve never had before."

Trump said phase two of U.S.-China trade would begin “right away.” Phase one was recently signed and includes China's agreement to protect intellectual property, holding back from currency manipulation, cooperate in financial services and purchase more than $200 billion of U.S. products over the next two years.

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