Published: Sat, December 08, 2018
Economy | By

Despite Trump's tariffs, US trade deficit at 10-year high

Despite Trump's tariffs, US trade deficit at 10-year high

For its part, China has said it will import more United States products to reduce its trade surplus, but no dollar amount has been publicly discussed.

The ballooning trade deficit with China is a particularly sore point for Trump, who campaigned on turning around the situation.

November exports rose 5.4 percent from a year earlier, Chinese customs data showed on Saturday, the weakest performance since a 3 percent contraction in March.

While Trump has long championed the tariffs, even referring to them as "the greatest", they are ultimately a tax on American consumers that raise the cost of goods.

The White House on Monday had to correct a statement by economic adviser Larry Kudlow, who incorrectly told reporters in a conference call that the 90-day negotiating period between the USA and China would begin on January 1 instead of December 1.

For trade with all countries, China's surplus was US$44.74 billion for November, compared with forecasts of US$34 billion and October's surplus of US$34.02 billion.

China's trade surplus with the United States was $35.55 billion in November, a record high and compared with $31.78 billion in the preceding month.


The trade tensions with Washington come at a tough time for Beijing, which is battling to tackle a mountain of debt as credit tightens and infrastructure investment falls.

But Trump again sought to paint the talks in a more positive light, highlighting a report from Bloomberg that "Chinese officials have begun preparing to restart imports of U.S. Soybeans & Liquified Natural Gas" that were put on hold as a result of the president's initial tariffs.

But unease over the agreement has dented stocks this week with major USA indices falling more than two per cent to close the market's worst week since March and one that left both the Dow and the S&P 500 in negative territory for the year.

China also reacted furiously after a top executive and daughter of the founder of Chinese telecom giant Huawei was arrested in Canada this week following a U.S. extradition request.

"China will start from agricultural products, autos and energy to immediately implement specific items that China and the US have agreed upon", Ministry of Commerce Spokesman Gao Feng told reporters in Beijing.

Furthermore, Kudlow seemed to downplay Trump's assertion following the meeting that China agreed to reduce or eliminate its tariffs on American automobiles, telling reporters that there was no "specific" agreement reached.

Trump tweeted out the quote, adding: "I agree!"

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