U.S. and Chinese trade negotiations are heading in a direction that could eliminate tariffs, according to Larry Kudlow, chief economic adviser to President Donald Trump.
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“At the moment, there is no deal,” he told Trish Regan during a FOX Business interview on Friday. “We’re just really starting out this process. But we’re moving in that direction. I think that’s the best part.”
Chinese officials arrived in Washington on Tuesday for five days of trade talks with the U.S. Trump has insisted on a reduction in the U.S. trade deficit with China by $200 billion from the current $370 billion. The White House has blamed the deficit for the loss of millions of U.S. jobs, which it says are then added to the Chinese economy.
But when U.S. officials met with their counterparts in Beijing last week, no deal was reached in large part because China refused a demand to cut the trade deficit by $200 billion within the next two years.
Kudlow previously said that U.S. negotiators, led by Treasury Secretary Steve Mnuchin, plan to ask Chinese to open their markets, lower trade and non-trade barriers and allow additional American exports.
A self-avowed advocate of free trade, Kudlow told Regan he hopes to see lopsided trade practices disappear. The Chinese impose a 25% tariff on American cars, while the U.S. only imposes a 2.5% levy on Chinese cars.
So far, Kudlow said, the trade talks have generated a lot of optimism on the American side.
“The point in all of this is that the trade talks are going very well,” he said. “I mean, actually, the president himself has shown more enthusiasm and optimism about this trade deal than I’ve ever seen.”