Investors are laser focused on U.S. trade negotiations with China ahead of President Trump’s meeting with Chinese President Xi Jinping at the Group of 20 summit (G-20) in Buenos Aires at the end of the month.
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Jitters over trade have resurfaced after the U.S. and China clashed over trade last weekend at the Asia-Pacific Economic Cooperation summit, casting doubt over whether Washington and Beijing can get at least a trade cease-fire at the G-20.
In an interview with FOX Business, President Trump’s Director of the National Economic Council, Larry Kudlow, toned down comments from last week, dovetailing with the new downbeat posture from the weekend.
“[The president] believes that China would like to have a deal, but he also told me [on] a number of occasions any deal between the two countries has got to be an American interest without any question,” Kudlow said. “It has to have frankly more than we've seen so far.”
Trump reiterated late Tuesday to reporters that China wants to “make a deal very badly,” but, again threatened further tariffs.
“I have another $250 billion in tariffs to put on China and believe me, I’m not afraid to use them,” he warned.
China blamed the U.S. Monday for souring the mood over the weekend. "It seemed like the US attended this APEC meeting with great anger. Its speeches and remarks at the meeting openly caused controversy, created discord, spoiled the atmosphere of the meeting..." Chinese Foreign Ministry Spokesperson Geng Shuang said in a statement.
Vice President Mike Pence told Xi and others at the summit that the U.S. won’t change course “until China changes its ways,” and threatened to more than double tariffs on the $250 billion already imposed on Chinese imports. The White House maintains its position that China's unfair trade practices hurt the U.S. economy.
The latest wrinkle comes after investors thought things were looking up ahead of Trump and Xi’s expected meeting at the G-20 following a friendly phone call between the two leaders, news that Treasury Secretary Steven Mnuchin resumed discussions with his Chinese counterpart and comments from Trump that China wanted to make a deal.
Among the administration’s must-have list: correcting intellectual property theft, zero tariffs and zero non-tariff barriers, the ability to enforce the agreement and strict timetables for implementation.
Former Microsoft CEO Steve Ballmer blasted China for cheating, saying in a recent FOX Business interview that 90 percent of companies in China are using the Microsoft operating system, though only 1 percent are actually paying for it. Ballmer says the theft has to end.
“I’m a free trader, by nature. I went to the school of economics – it’s the best thing for the world,” Ballmer told Maria Bartiromo. “This one’s a tricky issue because it’s absolutely clear that the rules don’t apply in China, and the U.S. government needs to do something," he stressed.
*This article was originally published on 11/21/18.