US President Donald Trump says he is ready to intensify his trade war with China by slapping tariffs on all $500bn of imports from the country.
“I’m ready to go to 500,” he said in an interview with the CNBC channel.
Mr Trump’s comments come before the most recent round of US tariffs has had time to take effect.
Last week, Washington listed $200bn (£150bn) worth of additional Chinese products it intends to place tariffs on as soon as September.
The list named more than 6,000 items including food products, minerals and consumer goods such as handbags, to be subject to a 10% tariff.
It is still under public consultation, to last until the end of August.
US ‘penalized’
The President has also been complaining that a strengthening dollar has been hurting US business.
In a series of tweets he blamed the higher dollar on currency “manipulation” by China and the European Union.
Mr Trump also criticised the US Federal Reserve for raising interest rates.
“The United States should not be penalized because we are doing so well. Tightening now hurts all we have done,” he said in a tweet.
The US and China have already imposed tit-for-tat tariffs of $34bn on each other’s goods. The President’s threat to raise that to $500bn represents a major escalation.
“We’re down a tremendous amount,” Mr Trump told CNBC, reiterating his view that China’s trade surplus with the US amounts to unfair trading practices.
When asked if the move might cause a stock market sell-off, he responded: “Well, if it does, it does. Look, I’m not doing this for politics. I’m doing this to do this right thing for our country.”
The US also wants China to stop practices that allegedly encourage transfer of intellectual property – design and product ideas – to Chinese companies, such as requirements that foreign firms share ownership with local partners to access the Chinese market.
Mr Trump has previously hinted at such an escalation, telling reporters two weeks ago that there was “$300bn in abeyance” after the $200bn of goods covered by the latest list, but this is his most explicit threat yet.
Many companies in the US are opposed to the administration’s use of tariffs against China, saying they risk hurting business and the economy without being likely to change behaviour.
European stock markets fell after the interview was broadcast, with the FTSE 100 down 0.4% in afternoon trade.
“It’s proof, if it were needed, that the president is prepared to go all the way in the trade war to exact concessions from China, which simply cannot match the US firepower,” said Neil Wilson, chief market analyst for Markets.com.
“In light of the EU and others saying they are ready to respond to tariffs on cars, the stakes are rising fast. Whether we get to the point where there is a full-blown trade war remains debatable, but the odds are shortening by the day.”
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Source: BBC
