Call to reduce surplus
16 March, 2018, 12:00 am
WASHINGTON – The Trump administration is pressing China to cut its trade surplus with the United States by $US100 billion ($F202b), a White House spokeswoman said on Wednesday, clarifying a tweet last week from President Donald Trump.
Last Wednesday, Mr Trump tweeted that China had been asked to develop a plan to reduce its trade imbalance with the United States by $US1b ($F2b), but the spokeswoman said Mr Trump had meant to say $US100b ($F202b).
The United States had a record $US375b ($F758b) trade deficit with China in 2017, which made up two thirds of a global $US566b ($F1.2 trillion) US trade gap last year, according to US Census Bureau data.
China reported its 2017 US trade surplus as $US276b ($F558b), also about two thirds of its reported global surplus of $US422.5b ($F855b).
The White House spokeswoman declined to provide details about how the administration would like China to accomplish the surplus-cutting goal — whether increased purchases of US products such as soybeans or aircraft would suffice, or whether it wants China to make major changes to its industrial policies, cut subsidies to state-owned enterprises or further reduce steel and aluminum capacity.
The request comes as the Trump administration is said to be preparing tariffs on imports of up to $US60b ($F121b) worth of Chinese information technology, telecoms and consumer products as part of a US investigation into China’s intellectual property practices.
It is also unclear if the requested $US100b ($F202b) reduction would address US complaints about China’s investment policies that effectively require US firms to transfer technology to Chinese joint venture partners in order to gain market access.
The issue is a core part of the probe being conducted under Section 301 of the Trade Act of 1974, a provision seldom invoked since the World Trade Organization was founded in 1995.
Trade experts have said tariffs imposed as a result of the China intellectual property probe may fall outside of WTO rules.