President Donald Trump has reportedly asked China to dramatically reduce the bilateral trade deficit.
Trump sent out an unusual tweet Wednesday announcing that his administration had requested China “develop a plan for the year of a One Billion Dollar reduction in their massive Trade Deficit with the United States.” A $1 billion reduction is a drop in the bucket considering the fact that the U.S. trade deficit with China in 2017 was $375 million.
Turns out the president’s tweet was off by $99 billion, the Wall Street Journal reported Thursday, citing people familiar with the situation. The Trump administration is pushing China to reduce the trade deficit by about one-third, Cornell University economist Eswar Prasad, who was briefed on recent talks between U.S. and Chinese officials revealed to TheWSJ.
When Liu He, a senior Chinese official involved in shaping Beijing’s economic policies, visited Washington last week to discuss bilateral trade with U.S. Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn. The talks focused heavily on the trade deficit, as well as the need for greater market access in China.
“Our relationship with China has been a very good one, and we look forward to seeing what ideas they come back with. We must act soon!” the president said in his tweet Wednesday.
The White House had not yet responded to The Daily Caller News Foundation at the time of publication.
The Trump administration has launched an investigation into the theft of American intellectual property by China, and the president is expected to place new tariffs on foreign-made steel and aluminum imports, moves that have prompted talk of a trade war.
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“History has shown that fighting a trade war has never been a correct way to solve a problem,” Chinese Foreign Minister Wang Yi said Thursday, “Especially given today’s globalization, choosing a trade war is a mistaken prescription.”
“The outcome will only be harmful. China would have to make a justified and necessary response,” he added, hinting at possible Chinese retaliation.
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