White House National Economic Council Director Larry Kudlow said he thinks a trade deal between the U.S. and China is “close,” but in a bit of a contradiction he warned that the Trump administration is ready to walk if it doesn’t like some of the terms.
“The president has said many times if the deal is no good, if the assurances with respect to preventing future thefts, if the enforcement procedure is no good he has said we will not go for it. We will walk away,” Kudlow said while appearing on CNBC’s “Squawk on the Street” on Friday. “The president has said that if we cannot get the enforcement and the assurances, then we will not go forward.”
It sounds like a lot has to go right for this “close” deal to get done. But Kudlow reassured the trade doubters that some form of a deal is “probably even closer than in mid-November.”
“The reality is constructive talks, almost daily talks,” Kudlow said. “We are in fact close. … There’s no arbitrary deadlines, but the fact remains Dec. 15 is a very important date with respect to a no-go or go on tariffs.”
Dec. 15 is indeed important. If nothing comes out of these talks, then the U.S. will enact 15% levies on another $160 billion in Chinese imports. And these new duties will target more consumer goods like cell phones and other electronics.
U.S. President Donald Trump did mention Thursday that something could happen regarding the impending tariffs, but he said it hasn’t been a topic of discussion yet. He also mentioned Tuesday that he’s willing to wait until after the 2020 presidential election to make any kind of deal, which rocked financial markets around the world.
The two countries have been trying to secure “Phase 1” of a new deal since preliminary agreements were announced in mid-October by Trump, but nothing concrete has been come from talks.
There have been some concessions made by both countries that could mean a move toward a deal. On Friday, China announced it will waive tariffs on U.S. pork and soybeans, which Beijing had agreed to do back in September.
But Kudlow said recent negotiations have been “intense.”
“I say intense because this is a very important matter,” Kudlow clarified. “There’s so much at stake here when you go through the various categories. … We can’t afford, we must not permit any country, China or whoever, to willy-nilly steal our breakthroughs in technology and advanced microprocessing related to 5G.”