With the ominous threat of a trade war between China and the US looking increasingly likely just a few weeks ago, the Apple CEO Tim Cook was quoted in an interview stating he was completely against President Trump’s stance, and China and the US needed to start working together rather than against.
The middle of May saw relations thaw and in a joint statement from the White House, the two governments announced they have reached “consensus on taking effective measures to substantially reduce the United States trade deficit in goods with China”.
Mr. Trump has spent much of his election campaign and presidency bemoaning the state of the US economy especially it’s trade relationships however this latest news indicates the Chinese and American governments are happy to do business with each other. The Chinese government are said to have made an internal decision to allow and encourage more US goods and services to enter the country.
American businesses and consumers are reliant on goods and services coming from China, however opening the market to more US goods is not something that was required. China are said to be opting to allow a more open market to entice new investment into their country and help to launch the local currency, the Yuan.
Mr. Trump had originally set off fears of a trade war as he considered tariffs on up to $150 billion worth of Chinese products. This sparked fears within many industries including the American agricultural industry which expressed concern that their business could be ravaged, since China is one of their largest trading partners for agricultural exports.
Mr. Trump’s recent announcement that he will be pulling the US out the Iran nuclear deal will also create problems of trade with European nations. Both the President of France, Emmanuel Macron and German Chancellor, Angela Merkel, tried and failed to persuade him against back out of this deal and it may result in a transatlantic trade conflict between the US and EU.
Trump had also planned to enforce tariffs on steel and aluminium imports from the EU which further complicated the relationship between the two parties. As promised on the campaign trail, Trump has introduced the possibilities of tariffs on these good in order to protect local steel and aluminium industries.