Date
25 January 2017
Donald Trump says his tariff hike proposal is a threat that if China doesn't behave, it will be taxed heavily. Photo: Reuters
Donald Trump says his tariff hike proposal is a threat that if China doesn't behave, it will be taxed heavily. Photo: Reuters

China says Trump is irrational after tariff hike proposal

China is reacting fiercely to a proposal by US Republican presidential frontrunner Donald Trump to jack up tariffs on Chinese goods.

Finance Minister Lou Jiwei called Trump an “irrational type” after the outspoken candidate said tax on Chinese goods should be increased to up to 45 percent, Reuters reports.

“Trump is an irrational type. If he were to do this, that would be in violation of the rules set by the World Trade Organization,” Lou told the Wall Street Journal in an interview.

Lou said that if the US puts Trump’s proposal into effect, it “would not be entitled to its position as the world’s major power. The US needs to recognise that the US and China are mutually dependent on each other. Our economic cycles are intertwined”.

However, he said rhetoric in a US presidential campaign can become heated.

Trump on Sunday again asserted that China has waged “economic war” against the US.

“They’ve taken our jobs, they’ve taken our money,” the billionaire businessman said at a campaign rally in New York.

“We can’t continue to be ripped off like we’re being ripped off.”

At a Republican presidential debate last month, Trump said China will not allow free trade or US manufacturers to compete freely.

“The 45 percent [tariff] is a threat that if they don’t behave, if they don’t follow the rules and regulations so that we can have it equal on both sides, we will tax you,” he said.

Republican rival Ted Cruz criticized the 45 percent tariff proposal, saying during the same debate that it would be passed on to US consumers.

“How does it help you to have a president come and say … I’m going to put a 45 percent tax on diapers when you buy diapers, on automobiles when you buy automobiles, on clothing when you buy clothing. That hurts you,” the US senator from Texas said.

The US reported a US$366 billion trade deficit with China in 2015, up from US$343 billion in 2014 — the largest US trade imbalance with any nation.

The deficit is up nearly 12 percent in the first two months of 2016 to US$57 billion. China is the largest US trading partner.

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