President Donald Trump Friday defended his threat to impose steep tariffs on steel and aluminum imports, saying potential trade conflicts can be beneficial to the United States.
“When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win,” Trump wrote in a post on Twitter. “Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!”
Trump’s planned tariffs, announced a day earlier, sparked concerns of a trade war, with emerging markets trading lower and some world leaders threatening to take retaliatory measures.
Stock market impact
The Dow Jones Industrial Average slid more than 300 points shortly after opening Friday. Japan’s Nikkei share average fell to a more than two-week low on Friday. The Nikkei closed 2.5 percent lower at 21,181.64 points, its lowest closing since February 14.
“Automakers will have to bear the cost, and they may also have to raise prices while auto sales are already sluggish,” said Takuya Takahashi, a strategist at Daiwa Securities. “This isn’t looking good to the auto sector.”
A Japanese government official told VOA that Tokyo “has explained several times to the US government our concerns,” but declined to comment further on any ongoing discussions with Washington.
“While we are aware of the president’s statement, we understand that the official decision has not been made yet,” the Japanese official said. “If the U.S. is going to implement any measures, we expect the measures be WTO-rules consistent.”
China on Friday expressed “grave concern” about the apparent U.S. trade policy, but had no immediate response to Trump’s announcement.
European Commission President Jean-Claude Juncker denounced Trump’s trade plan as “a blatant intervention to protect U.S. domestic industry.” He said the EU would take retaliatory measures, it Trump implements his plan.
Canada said it would “take responsive measures” to protect its trade interests and workers, if the restrictions are imposed on its steel and aluminum products.
Trump said Thursday the tariffs of 25 percent on steel and 10 percent on aluminum imports will be in effect for a long period of time. He said the measure will be signed “sometime next week.”
“I wouldn’t expect those (tariff levels) to change, but some of the other details need to be finalized,” White House Press Secretary Sarah Sanders said Friday.
The trade war talk had stocks closing sharply lower on Wall Street Thursday.
The American International Automobile Dealers Association said Trump’s tariff plans would increase prices “substantially.”
“This is going to have fallout on our downstream suppliers, particularly in the automotive, machinery and aircraft sectors,” said Wendy Cutler, a former U.S. trade official. “What benefits one industry can hurt another. What saves one job can jeopardize another,” she said.
White House press secretary Sarah Huckabee Sanders said the president’s decision “shouldn’t come as a surprise to anyone.” She said Trump had talked about the trade plans “for decades.”
Not all of Trump’s fellow Republican politicians agreed with his trade war talk.
Senator Ben Sasse of Nebraska said, “You’d expect a policy this bad from a leftist administration, not a supposedly Republican one.”
A spokesman for House Speaker Paul Ryan said the House majority leader hoped the president would “consider the unintended consequences of this idea and look at other approaches before moving forward.”
In a Twitter post Thursday, Trump said, “(O)ur Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world.” He continued, “We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!”
At a Thursday meeting, President Trump said the NAFTA trade pact and the World Trade Organization have been disasters for the United States. He asserted that the rise of China economically “was directly equal to the date of the opening of the World Trade Organization.”
Trump told officials from steel and aluminum companies that the United States “hasn’t been treated fairly by other countries, but I don’t blame the other countries.”
But Trump continued to defend the move. In a Friday tweet, the president said: “We will soon be starting RECIPROCAL TAXES so that we will charge the same thing as they charge us.” It is not clear who “they” referred to.
In 2017, Canada, Brazil, South Korea and Mexico accounted for nearly half of all U.S. steel imports. That year, Chinese steel accounted for less than 2 percent of overall U.S. imports.
– VOA News, March 02, 2018