Today, Robert Lighthizer, the Trade Representative of the United States of America, informed lawmakers that it will be necessary for the United States to maintain the threat of imposing tariffs on goods from China for years even if Beijing and Washington strike a deal to end a costly trade war.
At a hearing on U.S.-China issues that was held today, the top U.S. trade negotiator told the House Ways and Means Committee that China and the United States still have hard work ahead in order to secure a pact not only to put an end to the dispute, but to make sure that any agreements are met.
In his first public remarks since US President Donald Trump delayed a deadline to more than double tariffs on $200 billion (£153 billion) worth of Chinese goods, Lighthizer detailed a long road ahead to overhaul the trade dealings between the two largest economies in the world.
Lighthizer stated: “The reality is this is a challenge that will go on for a long, long time. Earlier, he said that he “is not foolish enough” to believe that a single negotiation will be able to change the increasingly sour bilateral trade relationship between the two nations.
Lighthizer defended the use of tariffs of the Trump administration. He said that they are the only a tool used to push China to make the major structural changes that he, President Trump and many of the lawmakers themselves are seeking.
He stated: “If there is disagreement at my level, the U.S. would expect to act proportionately but unilaterally.”
The continued threat of tariffs would be welcomed as disappointing news for the industry and the investors who are exposed to China and those who are hoping for an end to the uncertainty and disruption that is caused by the trade war.
The remarks of Lighthizer seemed to curb market hopes that a deal is imminent, with major U.S. stock indexes plunging into negative territory
Earlier this week, global equity markets rose after President Trump delayed the March 1 deadline to increase the tariffs to 25 percent from 10 percent and said that he may soon meet with Xi Jinping, the President of China, to finalise a deal.
A managing director at Robert W. Baird in Milwaukee, Michael Antonelli, said that the comments of Lighthizer that a deal is not imminent were “enough to cause the markets to sell off.”