Belfast Telegraph

UK Website Of The Year

Home News World

Trump to sign executive orders targeting 'trade abuses'

US president Donald Trump is poised to sign two executive orders aimed at cracking down on trade abuses.

The orders come a week before Mr Trump hosts Chinese president Xi Jinping at his estate in Florida, and follows tough election campaign rhetoric in which the man who became US leader said he would name China as a currency manipulator.

The US has its highest trade deficit with China, at 347 billion dollars (£278 billion) last year.

Peter Navarro, director of the White House National Trade Council, insisted the orders had nothing to do with the visit and were not an attempt to send a message to China.

He told reporters: "Nothing we're saying tonight is about China. Let's not make this a China story. This is a story about trade abuses, this is a story about an under-collection of duties."

The first of the two orders Mr Trump will sign calls for completion of a large-scale report to identify "every form of trade abuse and every non-reciprocal practice that now contributes to the US trade deficit," said commerce secretary Wilbur Ross.

Officials will have 90 days to produce a country-by-country, product-by-product report which will serve as the basis of future decision-making by the administration on trade-related issues.

"It will demonstrate the administration's intention not to hip-shoot, not to do anything casual, not to do anything abruptly, but to take a very measured and analytical approach, both to analysing the problem and therefore to developing the solutions for it," he said, describing the report as the first of its kind.

While Mr Trump has long argued that trade deficits imperil US workers, Mr Ross cautioned that they are not necessarily all bad.

In some cases, for instance, the US simply cannot produce enough of some things to meet domestic demand. In others, foreign countries may make products substantially cheaper or better than in the US.

Deficits in trade can also mean that foreign countries and entities are investing in US assets.

Mr Ross argued that the US has the lowest tariff rates of any developed country.

The report, he said, will examine whether deficits are being driven by things like cheating, specific trade obligations, lax enforcement and World Trade Organisation rules.

Mr Ross said the report would not focus extensively on currency manipulation, which is under the purview of the US Treasury Department, despite Mr Trump's bullish campaign rhetoric.

The second order will focus on stepping up the collection of anti-dumping and countervailing duties, which are levied against foreign governments what subsidise products so they can be sold below cost.

Mr Navarro said the US is leaving billions of dollars on the table as a result of lax enforcement of commitments in trade pacts.

The order will establish more effective bonding requirements, among other measures.

Mr Trump tweeted on Thursday evening that his first meeting with the Chinese leader would "be a very difficult one in that we can no longer have massive trade deficits ... and job losses."

He also wrote: "American companies must be prepared to look at other alternatives."

The US trade deficit totalled 502.3 billion dollars (£403 billion) last year, a slight increase from 2015, according to the commerce department.

The trade gap rose to its highest level since 2012 last year, though the imbalance remains below its 2006 high, shortly before the financial crisis struck.

Mr Trump has portrayed trade deficits as strangling economic growth and devastating factory jobs at home.

Research last year by academic economists, including David Autor of the Massachusetts Institute of Technology, found that China's emergence has hurt some communities and they have yet to fully recover.

But foreign trade has also helped reduce prices for clothing, cars and furniture, among other items, which has created savings for US consumers.

While economists concede the benefits of trade can be uneven, they argue the job losses which Mr Trump blames on trade pacts can largely be attributed to automation.

A study released this week by the National Bureau of Economic Research estimates that robots account for up to 670,000 lost factory jobs between 1990 and 2007.

Both exports abroad and imports into the United States fell in 2016, but exports declined by a greater sum in part due to a stronger dollar making American-made goods and services more expensive overseas.

Popular

From Belfast Telegraph