The United States and China are acting tough over trade, but they’re also busy talking to try to stop the situation spiraling out of control.
President Donald Trump ramped up tensions last week by ordering tariffs on about $50 billion worth of Chinese goods just weeks after announcing of sanctions on steel and aluminum imports. Beijing has responded with plans to target $3 billion worth of US products and warnings that it’s ready to inflict more pain.
The moves have fueled fears that the situation could escalate into a full-blown trade warbetween the world’s two largest economies. But Treasury Secretary Steven Mnuchin said Sunday that he’s been talking to Chinese officials in an effort to prevent that.
“We’re not afraid of a trade war, but that’s not our objective,” he said in an interview on Fox News.
“We are going to proceed with our tariffs … we’re also working on investment restrictions,” Mnuchin said. “But we are simultaneously having negotiations with the Chinese to see if we can reach an agreement.”
The US government wants China to do a lot more to open up its vast economy to US businesses and bring down the massive trade deficit between the two countries.
Trump has set a target of cutting the deficit in goods with China by $100 billion. It soared to $375 billion last year, according to US figures.