President Trump on Monday threatened to impose large tariffs on $300 billion in imports if Chinese leader Xi Jinping did not meet with him in Japan later this month, showing how he plans to immediately pivot from his trade war with Mexico back to Beijing.
Trump, in a wide-ranging and apparently impromptu interview with CNBC, said he was “scheduled to have a meeting” with Xi during the Group of 20 summit in Osaka, but Chinese officials have refused to publicly confirm the gathering.
“We do not want a trade war, but we are not afraid of fighting one,” said Geng Shuang, spokesman for China’s Ministry of Foreign Affairs. “If the U.S. is ready to have equal consultations, our door is wide open. But if it insists on escalating trade frictions, we will respond to it with resolution and perseverance.”
If Xi doesn’t meet with him, Trump said that he will move forward with tariffs on $300 billion in Chinese imports, which includes numerous consumer products.
“China is going to make a deal because they are going to have to make a deal,” Trump said.
The interview signaled that Trump plans to use the same adversarial approach with foreign leaders in the coming weeks that he has used for more than a year. Based on his comments, he does not appear stung by the growing criticism from business groups and GOP lawmakers who have openly questioned whether he is misusing tariffs as a policy tool in a way that could hurt the U.S. economy. Trump brushed aside the criticism and said his approach is the only one that gets results.
“Tariffs are a beautiful thing when you are the piggy bank,” Trump said.
Trump complained again about what he views as a trade imbalance, with the U.S. importing more goods than it exports. He believes this difference is caused by unfair rules and policies that stretch back for decades and that rebalancing trade will create more U.S. jobs. Part of his focus with Mexico and Canada in particular has been on forcing companies to move operations out of those countries and back to the United States.
The telephone interview was unusual because it appeared to be in response to an earlier CNBC segment in which a U.S. Chamber of Commerce executive criticized the president’s tariff threats against Mexico last week. Trump had threatened to impose a 5 percent tariff on all Mexican goods beginning Monday if Mexico didn’t take concrete action to stem the flow of migrants entering the United States.
On Friday evening, Trump called off the tariff threat and announced that the U.S. and Mexico had reached a deal to stem the flow of migrants.
During Trump’s interview with CNBC, he also had scathing criticism of the U.S. Federal Reserve and complained that Xi effectively had control of China’s central bank, while bemoaning the fact that he did not.
“Our Fed is very, very destructive to us,” Trump said. “They haven’t listened to me.”
Trump has said the Fed should not have raised interest rates last year and has pushed the independent bank to cut interest rates this year.
He has complained that the decision makers at the Fed are not “my people.”
“They certainly didn’t listen to me because they made a big mistake,” he said.
In fact, Trump has nominated four of the five Fed board members, including its chair, Jerome E. Powell. But his last four picks to fill two remaining slots have been blocked by Senate Republicans.
It’s unclear how effective last week’s deal will be, as much will depend on how it is enforced, but Trump defended it vigorously during the CNBC interview. He said the only reason Mexican officials agreed to changes was because he threatened their goods with tariffs.
“They didn’t even respect us,” Trump said. “They couldn’t even believe how stupid we were."
In the interview, he also attacked Facebook and hinted that it and other U.S. technology companies could face antitrust scrutiny from the Justice Department.
“Obviously there is something going on in terms of monopoly,” Trump said.
With the Mexico standoff temporarily resolved, much of the focus will now shift back to Trump’s approach with China. In the past year, Trump has imposed large import penalties on $250 billion in Chinese goods. He has accused China of unfairly subsidizing its companies, stealing U.S. intellectual property, and ripping off U.S. companies and businesses by creating a distortion between imports and exports.
Last year, Chinese officials agreed to negotiate changes to the economic relationship with the United States, but White House officials said several weeks ago that Chinese officials had begun backtracking, leading Trump to ratchet up pressure and tariffs.
The Trump administration has largely sought to shield major consumer products like electronics and other goods from the tariffs, but that will change if Trump follows through on his threat to penalize an additional $300 billion in goods, something he said would happen if Xi doesn’t cut a deal with him soon. But the fact that Chinese leaders won’t even confirm a meeting between Xi and Trump in a few weeks reflects a level of mistrust between both sides.
“If we don’t have a deal, if we don’t make a deal, then we will be raising the tariffs,” he said.
Trump has also threatened to impose tariffs on imports from Japan and the European Union, but he has recently shelved those while he continues to try and put pressure on the Chinese government. Those talks could impact a number of U.S. industries and goods, ranging from things like cars to wine, where Trump has said he is trying to boost U.S. production and exports.