Trump Tweet on China Trade Understates U.S. Demand, Officials Say
By Lingling Wei
BEIJING -- President Donald Trump tweeted Wednesday that Washington had asked Beijing for a plan to cut the U.S. trade deficit with China by $1 billion -- less than 0.3% of the countries' annual trade gap or around one day's worth of trade imbalance.
In fact, according to people familiar with the matter, Trump administration officials requested a $100 billion reduction in the U.S.-China trade deficit when meeting with President Xi Jinping's top economic deputy last week.
According to the people, Liu He, the main architect of China's economic policy, said in his Washington meetings that narrowing the vast bilateral trade deficit was in China's interest as China seeks to shift away from an export-led growth model. It is unclear how feasible the deficit-reduction goal is for Beijing and what kind of plan it could offer.
Cornell University economist Eswar Prasad, who was briefed by Chinese officials about the Liu visit, said they told him the U.S. was pressing for a reduction in the bilateral trade deficit by about one-third.
The tweet came at a time of rising global trade tensions, with the relationship between the world's two largest economies at the center. Having set new solar-panel tariffs in January, mainly aimed at China, Mr. Trump now plans to impose stiff tariffs on all steel and aluminum imports to the U.S. The plan has stoked fears of a global trade spat and has drawn broad opposition from U.S. trading partners as well as U.S. lawmakers.
Write to Lingling Wei at firstname.lastname@example.org
(END) Dow Jones Newswires
March 08, 2018 08:23 ET (13:23 GMT)Copyright (c) 2018 Dow Jones & Company, Inc.