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Tags: china | trade | us | larry kudlow | donald trump

Kudlow: Blame China for Unfair Trade Policies

By    |   Wednesday, 04 April 2018 01:05 PM EDT

Larry Kudlow, the chief economic adviser to President Donald Trump, blamed China’s unfair practices for spurring global fears of a trade war between the world’s top two economies.

His comments came as China threatened to impose levies on U.S.-made goods in response to Trump’s $50 billion tariff plan.

“Blame China, not President Trump,” Kudlow said on the top-rated Fox Business channel. “Because they’ve been going on for many years. Trump is really the first president to fight back.”

Beijing imposed retaliatory tariffs on 106 American imports overnight, including soybeans, automobiles and chemical products in response to Washington's plans to place tariffs worth at least $50 billion on Chinese goods. 

China's tax agency didn't give any date for the 25 percent increase to take effect and said that will depend on what Trump does about U.S. plans to raise duties on a similar amount of Chinese goods.

Stocks fell at the open but later recovered. The Dow Jones Industrial Average was up 110 points higher, while the S&P 500 gained 0.6 percent and the Nasdaq Composite rose 0.8 percent by 3 p.m. At its session lows, the Dow fell 510 points, while the S&P 500 was down as much as 1.6 percent and the Nasdaq slumped by 1.9 percent, respectively.

Kudlow warned investors against over-reacting, and said the United States and China are engaged in discussions about trade policies. It could take several months for any real action to be taken on the tariff proposals, Kudlow said.

The gap between Chinese goods imported to the United States and American goods exported to China rose to a record $375.2 billion last year, up from $347 billion the prior year, the Commerce Department said in February.

Kudlow, a long-time supporter of free trade, hinted at a possibility of no tariffs at all. He said Trump supports free trade and wants to remedy trade imbalances “with the least amount of pain.” 

“Trump is putting his cards on the table, he’s standing up for this country,” he said. “But he’s also standing up for better world trade. President Trump regards himself as a free trader. I do too. But the path to free trade, real free trade, must include tremendous reforms and stopping these illegal and unfair trade practices.”

The U.S. Trade Representative last year presented a report Congress that highlighted the many non-tariff barriers that American companies face when trying to do business in China.

“Chinese government officials, acting without fear of legal challenge, at times require foreign enterprises to transfer technology as a condition for securing investments approvals,” the report said.

The report said major areas of concern also include inadequate enforcement of intellectual property rights, policies that favor state-run companies, government subsidies, limits on U.S. agricultural products and a general lack of transparency.

Kudlow last month said China could expect the United States to take a tough stance on international trade.

"I must say as somebody who doesn't like tariffs, I think China has earned a tough response not only from the United States," Kudlow said on cable channel CNBC, where he had worked as an anchor and contributor since the 1990s.

Trump last month appointed Kudlow to be the top adviser on the economy, replacing Gary Cohn, the former president of Goldman Sachs who had worked at the White House since inauguration.

Kudlow entered the White House at a time when Trump had taken action to fulfill his campaign pledge to renegotiate trade agreements that he blamed for hollowing out the U.S. industrial base and sending jobs to China and Mexico.

While Trump’s pro-business agenda includes cuts to taxes and regulation, his stance on trade is worrisome for multinational businesses that depend on cheap imports.

A group of U.S. retail giants including Walmart, Target and Costco last month asked Trump to reconsider imposing tariffs against China, saying they could hurt American families, the BBC reported.

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Larry Kudlow, the chief economic adviser to President Donald Trump, blamed China's unfair practices for spurring global fears of a trade war between the world's top two economies.
china, trade, us, larry kudlow, donald trump
Wednesday, 04 April 2018 01:05 PM
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