Trump says tariffs taking a toll on China's economy
A Chinese official waits on a chair in the corridor outside the room where the bilateral meeting between Chinese President Xi Jinping and US President Donald Trump took place on June 29, 2019, during the second day of the G20 Summit in Osaka, Japan. EPA-EFE/FILE/LUKAS COCH
Washington, Jul 15 (efe-epa).- President Donald Trump said Monday that the tariffs imposed by his administration were taking a toll on China's economy, causing the Asian giant's growth rate to slow.
"China's 2nd Quarter growth is the slowest it has been in more than 27 years. The United States Tariffs are having a major effect on companies wanting to leave China for non-tariffed countries," the president said in a Twitter post.
Trump said the tariffs were not only influencing corporations' decisions on where to set up operations, but also putting pressure on Beijing to reach a trade agreement with Washington.
"Thousands of companies are leaving. This is why China wants to make a deal with the U.S., and wishes it had not broken the original deal in the first place," Trump said.
The US leader touted the revenue generated by the tariffs imposed on imported Chinese goods.
"In the meantime, we are receiving Billions of Dollars in Tariffs from China, with possibly much more to come. These Tariffs are paid for by China devaluing & pumping, not by the U.S. taxpayer!" Trump tweeted.
The president's views on tariffs run counter to those of economists, who argue that the trade levies are, in effect, a tax on consumers because they result in higher prices.
The Trump administration, for its part, contends that tariffs can be used as an effective policy tool.
Trump's tweets were posted hours after the Chinese government said the gross domestic product (GDP) grew 6.3 percent in the first half of 2019, or 0.50 percentage points less than in the same period last year.
The National Bureau of Statistics said Monday that the GDP grew only 6.2 percent year-on-year in the second quarter, marking the weakest performance in 27 years and confirming analysts' predictions that the ongoing trade war with the United States would cause a slump in domestic demand.
China's GDP grew 6.4 percent in the first quarter.
In late June, Trump and his Chinese counterpart, Xi Jinping, met on the sidelines of the G20 Summit in Japan and agreed to a truce in the trade war, with Washington holding off on imposing new tariffs on China and allowing US companies to sell products to tech giant Huawei.
The two leaders agreed during their meeting in Osaka to resume trade negotiations amid Washington's decision to not slap tariffs on all Chinese imports.
In May, Trump imposed a 25 percent tariff on Chinese imports worth $200 billion in response to the lack of progress in reaching a trade deal with Beijing.
China, for its part, retaliated by slapping tariffs on US imports worth $60 billion.
Trump later threatened to impose tariffs ranging from 10 percent to 25 percent on another $325 billion of Chinese imports, causing concern in financial markets and the business community due to the possible effect on consumer spending, which accounts for about two-thirds of US economic activity.
While additional tariffs are off the table for now, the United States will maintain the tariffs imposed on a total of $250 billion in Chinese goods, while Beijing will continue to slap tariffs on US imports totaling $110 billion.
In 2018, the United States posted a trade deficit of $419 billion with China due, largely, to the fact that US exports to Asia's largest economy totaled just $120 billion, while American imports from China reached $540 billion. EFE