In a bout of impatience, Trump threatened to drastically raise Chinese tariffs, as the latter considered pulling out of trade talks on Sunday.
Trump took to Twitter to state that he was planning to raise tariffs on $200 billion in Chinese imports to 25% starting from Friday. These levies are 10% currently. He also stated that he would imminently impose 25% tariffs on the $325 billion in Chinese goods that have not been taxed since the trade war begun.
"The Trade Deal with China continues, but too slowly, as they attempt to renegotiate," Trump tweeted. "No!"
It is expected that the Chinese will react swiftly and strongly. Previously, they raised duties on $110 billion of American imports in retaliation to initial tariff hikes. They have also slowed customs clearance for large US corporations and exacerbated the existing regulatory lens that was always on such companies.
"Let Trump raise tariffs. Let's see when trade talks can resume," Hu Xijin, a notable Chinese journalist, said in a tweet.
Although Asian stocks have plummeted by 4% in light of investor concern over the potential implementation of Trump's threat, many believe it is just that: a threat. Trump is known to make volatile statements that are often personally motivated and not necessarily politically vetted, and this may be a product of that trend.
"With President Trump, you never know, but there is a good chance that this is just a threat," said Chad Bown, a senior fellow at the Peterson Institute for International Economics. "If they announce a deal later this week, it will make it appear as if he acted as tough as possible to get the deal."
That said, if the tariffs were to ultimately materialize, the process could take up to three months at least. It would need to be designed, measured and ultimately ratified in order to manifest in a tangible manner that would start affecting Chinese products and businesses- and US consumers, for that matter.
With respect to the threat, Kamala Harris, a leading presidential candidate for the Democratic party, said: "It is a display of a president who thinks that unilateral action is better than working with the friends to address issues that not only impact our country, but impact the globe. And I think it puts us in a weaker position."
- https://www.wsj.com/articles/trump-says-he-will-increase-tariffs-on-200-billion-of-chinese-goods-from-10-to-25-on-friday-11557075332
- https://www.theguardian.com/world/2019/may/12/trump-china-tariff-hike-trade-war
- https://www.theguardian.com/business/2019/may/05/trump-escalates-trade-war-with-china-with-plan-to-raise-tariffs