White House Looks to Slash China's Bilateral Trade Surplus by $100 Billion

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Wall Street stocks tumbled on Tuesday on growing worries about a trade war as President Donald Trump replaced his Secretary of State and was reportedly planning new tariffs on China.

"We, therefore, do not expect China to stand by idly if the Trump administration steps up its protectionist policies", DBS said.

Smartphone chipmaker Qualcomm slumped 5 per cent after the Trump administration blocked Singapore-based Broadcom's unsolicited bid for the company on national security grounds. Additionally, the president criticized several European countries of engaging in unfair trade deals with the U.S. He urged the committee to make it harder for China to evade reporting requirements for any money it gives to U.S. colleges and universities and to "require colleges and universities to choose between federal funding and Confucius Institute-related funding from the Chinese government". Trump has already made clear he wants to dramatically reshape NAFTA, and since the tariffs were announced, South Korea has signaled it wants to negotiate an exemption as well.

This would have wide-reaching implications, including driving up the price of smartphones and other products manufactured in China.

"Imported aluminum used to make beer cans is not a threat to national security", said Jim McGreevy, the Beer Institute's CEO. But "some administration officials have raised objections to the visa restrictions, and it's unclear whether they'll be included in the final package".

--Manufacturing executives should undertake a systematic supply-chain review.

In Beijing, Chinese foreign ministry spokesman Lu Kang said Sino-U.S. trade relations should not be a zero-sum game, and that the two countries should use "constructive" means to manage tension.

Ethan Harris, head of global economics at the Bank of America Merrill Lynch said: "This is not new".

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The move drew consternation outside the U.S.

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"That is what makes the sound bites of the current US administration so disturbing", said Marietje Schaake of the parliament's ALDE liberal group.

The EU trade commissioner has warned the United States that if it is not excluded from Donald Trump's steel and aluminium tariffs it would be "very damaging for trans-Atlantic relations".

Trump has also raised the possibility of escalating the potential trade war if Europe reacts, and said that he could increase tariffs on European Union cars sent across the pond.

While that is not a lot for the economy as a whole, it would be painful for the individual industry.

The United States previous year rejected three major Chinese acquisitions of USA technology companies, including a semiconductor maker, an Internet-services provider and in-flight entertainment company, and a mobile ad developer.

The Trump administration is putting together a package of anti-China measures, including tariffs on at least an annual $30 billion of Chinese imports, to pressure Beijing to end requirements that US companies transfer technology to Chinese firms.

In Asia, a large share of Japanese and Chinese steel goes to countries in the region's southeast, where booming construction and light industries are fueling strong demand for steel. Although Electrolux utilizes US-produced steel at its plant, the company anticipates that the cost of appliances produced in the U.S. will increase and has postponed investment in United States operations as it evaluates the full impact of the tariff. That would hurt producers but boost profits of construction and other industries in Southeast Asia.

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