Participants in a discussion on the effect of US tariffs on China and other countries said it could have a lasting impact on the US economy, trade with key partners, including Canada, Mexico and Europe, and international relations.
The discussion on Tuesday was held at the China Institute in America, a 100-year-old organization based in New York City that strives for better relations between China and the United States.
Panelists included Craig Allen, former president of the US-China Business Council; Brad W. Setser, a senior fellow at the Council on Foreign Relations and former senior adviser to the US Trade Representative; and Susan Yuqing Feng, a journalist and director of programs at the China Institute in America, who moderated the discussion.
Feng said the US government has placed tariffs on more than $440 billion of Chinese imports, and the current tariffs on Chinese goods are around 39 percent. She asked what effect that would have on global trade relations.
"If you put 25 percent tariffs on the entire world or 20 percent tariffs on the entire world, the US will import less. We'll also export less," Setser said.
Since the beginning of his second term, President Donald Trump has placed 20 percent additional tariffs on Chinese imports to the US. He has also enacted a broad 25 percent tariff on Canada and Mexico. He enacted tariffs of 25 percent on all steel and aluminum imports, and plans reciprocal tariffs for most trading partners on April 2.
Allen said it was important to understand what the Trump administration is trying to achieve by using tariffs, that it is mainly to bring back manufacturing and jobs to the US. But he said the levies have several other purposes.
"They're to raise revenue, tariffs can also be used for retribution. …Tariffs can be used for reciprocity to encourage other countries to lower their tariffs for perceived harms, and that's a useful framework to look at the president's policies," Allen said.
Mexico, Canada and China are the US' top three trading partners.
However, the president's reason for increasing tariffs on China seems unclear.
No clear goals
"I don't think the goals that this administration has set out are clear yet," Setser said. "There's obviously contradictions. If you follow their own rhetoric, we are just actually getting started.
"These are the appetizers, … The main course perhaps comes on April 2 with the reciprocal tariffs, so perhaps it gets delayed and pushed beyond."
Allen noted that the trade landscape between the US and China has changed over the past decade.
