Trump Declines to Label China a Currency Manipulator as Trade War Brews
But Mr. Trump may have been persuaded not to label China a currency manipulator by business executives, who have warned the president that such a move could be disastrous for American companies.
In his first months in office, Mr. Trump was surprised by the opposition to his plan to label China a currency manipulator, always a popular line on the campaign trail. In a meeting with business leaders last year, an executive of one of America’s largest exporters told the president that labeling China a currency manipulator could be harmful for his business, a person briefed on the discussion said.
The president responded incredulously, and was surprised when the other executives in attendance said they completely agreed, the person said.
The Treasury Department determines if a country should be labeled a currency manipulator based on bilateral trade deficits and signs that another country is depressing the value of its currency. The United States has not officially called another country a manipulator since it slapped the label on China in 1994, and doing so is supposed to kick-start negotiations to resolve the problem.
This year China, Germany, Japan, South Korea, Switzerland and India were placed on Treasury’s monitoring list for potential currency manipulation.
Corporate chiefs and investors are hoping that the U.S. and China can negotiate a settlement before the tariffs go into effect. But that looks highly uncertain. The countries are not currently engaging in formal negotiations, and the United States has not presented China with a list of actions it could take to avoid the tariff threats.
Instead, the Trump administration appears to be pushing ahead on tariffs, as well as restrictions on investment that are expected be announced in the coming months. The United States trade representative is aiming to publish a list of Chinese goods as early as next week that would incur additional tariffs if Mr. Trump makes good on his most recent threat to tax an additional $100 billion in Chinese goods.
The White House has already begun imposing tariffs on Chinese steel and aluminum and has outlined another $50 billion worth of imports that would be subject to tariffs, including flat-screen TVs. The Chinese, in return, have begun imposing tariffs on American pork and threatened levies on additional products, primarily agricultural.
News credit : Nytimes