- REUTERS/Fred Dufour/Pool
- Larry Kudlow, President Donald Trump’s top economic adviser, said Chinese President Xi Jinping is the biggest roadblock to a US-China trade deal.
- “I think Xi is holding the game up,” Kudlow said at the Delivering Alpha conference.
- Kudlow said talks between the US and China about eliminating the recent tariffs were stalled.
During an interview with CNBC’s Jim Cramer at the Delivering Alpha conference, Kudlow said that while other Chinese officials – including China’s top economic official, Vice Premier Liu He – are open to a deal to ease tensions and reduce tariffs, Xi is holding up progress.
“I think Xi is holding the game up,” Kudlow said. “I think Liu He and others would like to move but haven’t.”
The current trade tensions between the US and China flared up in March, when Trump threatened to impose tariffs on $50 billion worth of Chinese imports to the US. The administration said that the tariffs were necessary to punish China for their theft of US intellectual property and force the government to reform their economic practices.
The threat of tariffs led to a counter-threat from China and kicked off weeks of furious negotiations between the two countries in an attempt to reach a deal.
When a preliminary deal fell through due to Trump’s insistence on moving forward with tariffs, talks broke off. The tariffs on the first $34 billion worth of Chinese goods went into effect on July 6, and China responded with equal force later that day.
Kudlow said talks between the two countries are currently stalled.
“I think he needs to move. We are waiting for him. The ball is in his court. ” Kudlow said of Xi.
The US has threatened to hit another $200 billion worth of Chinese imports with tariffs because of China’s retaliation to the previous round of tariffs. The Chinese Ministry of Commerce has warned of an equal response if the US goes through with a second round.
So far Trump has been vague about what exactly China needs to offer in the form of a trade deal in order for the barriers to come down, but Kudlow offered a laundry list of items that the US would need to see in order to eliminate the tariffs.
“And the tit-for-tat business, which is nobodies favorite path, but nonetheless, they can end that this afternoon by providing a more satisfactory approach and, essentially Jimmy, doing what the rest of the world knows needs to be done: tariffs down, non-tariff barriers down, IP theft no, allow the American or British or German or whoever full ownership of companies,” Kudlow said.
During the interview, Kudlow also said talks with Mexico on a renegotiation of the North American Free Trade Agreement, or NAFTA, were moving forward.
And he said he has heard that European Commission President Jean Claude Juncker would make a significant free trade offer during a visit to the US next week. Kudlow said, however, that he could not provide further details.