The president-elect’s campaign pledges are a ‘negotiating tactic’ for leverage in trade talks—and they may already be working, a think-tank analyst suggests.
‘Asymmetric Trade Warfare’ Without an effort to renegotiate trade deals before imposing “across-the-board” tariffs, which also would slap a 25-to-100 percent fee on imports from Mexico, “I think the Trump administration is underestimating how other countries might react,” he said.
Speaking to reporters after congratulating the president-elect on his reelection, von der Leyen said Trump appeared eager to sustain what the Congressional Research Service calls “the world’s largest trade and investment relationship,” which accounts for 46 percent of global gross domestic product.
A 2023 study estimated that under Section 301 of the Trade Act of 1974, tariffs decreased imports from China by 13 percent each year from 2018 to 2021.
Donald Trump, who was then-U.S. President, signs trade sanctions against China in the Diplomatic Reception Room of the White House in Washington on March 22, 2018.
Brad Sherman (D-Calif.) is among those in Congress lobbying for a hard line against imports from China, calling on the Biden administration to slap “an automatic 25-percent tariff on all China goods” during a February 2023 House hearing.
But Posen said China will remain “a special case,” noting Elon Musk “is going around saying to people in China: ‘Count on me.
A 60-percent tariff on imports from China will spur “asymmetric trade warfare,” Posen said.
Economists near-universally warn that President-elect Donald Trump’s pledge to impose “across-the-board” 20-percent tariffs on imports will trigger inflation, disrupt domestic industries, and spur global trade wars.
Allies are “probably just going to try to make nice with Trump: ‘We’re going to be aligned with the U.S. on national security and, therefore, against China,’” Posen said.
And so these big emerging-market countries with geopolitical strength are going to actually do pretty well, and they’re probably going to successfully play off the U.S. and China,” Posen said.
But the threats may be a “negotiating tactic” to give the United States leverage in mediating trade pacts, Peterson Institute for International Economics (PIIE) President Adam Posen said during a Nov.
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