WASHINGTON (CN) – Escalating a trade war with no end in sight, President Donald Trump said Thursday he will impose a new 10% tariff on $300 billion worth of Chinese goods beginning in September.
“Trade talks are continuing, and during the talks the U.S. will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country,” Trump tweeted. “This does not include the 250 Billion Dollars already Tariffed at 25%.”
The president also criticized China for not buying large quantities of American agricultural goods and for not stopping the sale of fentanyl to the U.S.
While Trump said Thursday trade talks between the two economic superpowers were positive and the future is bright, he implied two days earlier that negotiating a trade agreement with his administration would be harder if he is re-elected in 2020, claiming Chinese representatives were waiting to “rip off” an incoming Democrat.
The president has routinely taken shots at Chinese integrity through Twitter, saying they “just don’t come through” in negotiations. He promised during his 2016 presidential campaign to brand the country as a currency manipulator, but has yet to do so.
Last year, Trump met with Chinese President Xi Jinping in Argentina at the G20 Summit and agreed to a deal for China to purchase more American products, among other trade-specific stipulations. But the deal hiccupped when Trump announced higher tariffs on $200 billion worth of Chinese goods in May.
In June, Trump and Xi symbolically agreed to a second deal for China to purchase a large amount of agricultural products at this year’s G20 Summit in Japan, but Trump accused China of reneging on that deal in announcing the new tariffs.
The trade war between the two countries was a key factor in the Federal Reserve’s decision Wednesday to cut interest rates for the first time since the start of the recession more than a decade ago.
Archil Cheishvili, CEO for GenesisAi, which uses artificial intelligence to form an analytics platform for capital markets, said he believes the trade war will only get worse. The ongoing battle will devastate the Chinese economy before it affects the American economy, he said.
Cheishvili said America already has experience in busting foreign economies, comparing the current trade war between China and the U.S. to a trade war between the U.S. and Japan in the 1980s.
“People saw that Japan would overtake the U.S. as the largest power country in the world,” Cheishvili said in an interview Thursday. “In the 1980s, the U.S. imposed a 100% tariff on electronics and other imports coming from Japan. … Japan is pretty much still in recession right now.”
He said Trump has two things in mind when it comes to the trade war, one of them being that an American recession is unlikely to occur before the 2020 election.
“The second thing that he cares about is that it will affect China much, much worse than it will affect the U.S., and he will be absolutely right about that,” Cheishvili said. “China has much more non-performing loans than it had in recent history. Much more than Greece had, much more than Italy had. …We think that this will trigger a recession in China, which will trigger a global financial crisis afterwards.”