Trade deficit grows 5% to $56.6B, hits post-recession high

Trade deficit grows 5% to $56.6B, hits post-recession high

A Commerce Ministry official said last week that Trump's plan to levy tariffs of 25 percent on steel and 10 percent on aluminum would "seriously damage multilateral trade mechanisms represented by the World Trade Organization and will surely have huge impact on normal worldwide trade order".

"We will urge the global community to refrain from adopting measures that inhibit free trade", said the minister, Paik Un-gyu, according to a ministry statement.

President Donald Trump said Wednesday that he has asked China to develop a plan to reduce the current trade deficit between the two countries by $1 billion.

Chinese steel prices, which drive global prices, are still almost 40 percent higher than when Trump first launched his "Section 232" investigation in April into whether steel and aluminum imports threatened US national security. Trump slapped 25 percent tariffs on steel imports and 10 percent for aluminium on Thursday. In a globalised world, choosing a trade war is the wrong prescription.

Tata Steel Europe told Reuters: "We welcome the announcement of the European Commission that appropriate and swift measures will be taken to safeguard our industry". Exports fell 1.3 percent from December, the most in more than a year, while imports were little changed. Other Chinese media have not covered much on U.S.

China's goods surplus with the United States, a sore spot in relations between the two countries, narrowed slightly last month but is higher so far this year than at the same point last year.

"The bigger picture is that while China's trade surplus with most of the world has declined during the past year thanks to the stronger Chinese demand for commodities, its surplus with the United States has continued to expand".

"They had candid discussions about India-China bilateral relations and enhancing mutual exchanges", it said.

Brazil, which after Canada is the biggest steel supplier to the USA market, said it wanted to join the list.

While China's global steel exports have dropped by nearly a third this year, tariffs on aluminium may be an easier sell for Trump, as China's shipments increased more than 35% in the first two months of the year.

China's trade surplus widened to $33.74 billion for February, compared with forecasts for $0.6 billion and January's $20.35 billion. She also noted the steel and aluminum industry in North America is highly integrated and said the Canadian government will continue to make that point directly with the Trump administration.

The White House has said Mexico, Canada and other countries may be spared from the planned tariffs under national security "carve-outs", a move that could soften the blow amid threats of retaliation by trading partners and dire economic warnings from United States lawmakers and business groups.

The United States has had the world's largest trade deficit in every year since 1975. Its data showed that the USA was the destination for only 1.4% of China's steel exports.

The comments follow those of China's foreign minister Wang Yi, who Thursday criticised the US's decision to brand the country as a "strategic competitor" and dismissed the notion that it poses a threat to the world's biggest economy.

Related Articles