Trade Update: Wilbur Ross Joins China Delegation, Trump Extends EU, NAFTA Steel Tariff Exemption 30 Days…

President Trump’s MAGAnomic team have announced a 30-day extension for the Steel (25%) and Aluminum (10%) tariffs for the European Union, Canada and Mexico.

Also, after a prior agreement with South-Korea, the “KORUS” deal, team U.S.A. has also reached an agreement in principle with Australia, Argentina and Brazil which will be finalized in next 30 days.

Via Wall Street Journal – President Donald Trump has decided to postpone decisions about imposing steel and aluminum tariffs on the European Union and other U.S. allies until June 1, a senior administration official said.

In addition to announcing the delay, the White House is expected to say Monday evening that it has finalized a deal to exempt South Korea from the tariffs, mirroring details that have been previously released by the U.S. Trade Representative’s office.

The remaining decisions on tariffs will be decided later, the official said. A White House spokeswoman declined to comment.

The U.S. initially imposed world-wide tariffs of 25% on U.S. steel imports and 10% on aluminum in March, but it temporarily exempted several U.S. allies from the tariffs. Monday’s decisions extend that delay.  (read more)

Additionally, to showcase the importance previously outlined, the team has added ‘big timber’, Commerce Secretary Wilbur Ross, to the trade delegation heading to China.

So the entire MAGAnomic “killers” team appears to be heading to Beijing.  Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin, U.S. Trade Representative Robert Lighthizer, Chairman of National Economic Council Larry Kudlow, WH Trade Adviser Peter Navarro and U.S. Ambassador to China, Terry Branstad.

[Side-Note: hopefully they take AF2]

This diplomatic and strategic geopolitical trade line-up further solidifies the importance of the trip.  As “dufrst” shared earlier:

NAFTA and the trade tariffs on steel and aluminum (major components of cars) are about credibility against China, Japan and the EU. The bulk of the US trade deficit comes from China, Japan, and the EU. China, Japan and the EU all exploit NAFTA to get around US trade barriers that should have balanced trade among these countries.

Trump has signaled that he wants trade renegotiated but the major trade entities- China, Japan and the EU- didn’t take him seriously until he slapped tariffs globally on steel and aluminum. That was a direct strike at their automobile industries that make up the bulk of the US trade deficit between the EU and Japan. The intellectual property tariffs got the attention of China because not only did Trump place them on China but he mobilized support in the EU and Japan for action on intellectual property theft.

So where does the North Korean (NK) negotiations come into play in all of this?

Aside from the possibility that the US sabotaged the last Korean nuclear tests, I believe this Korean peace initiative is more about Japan and South Korea than China. I believe Japan and South Korea will agree to more favorable terms with the US on trade pending the denuclearization and potential reunification of Korea. I believe Japan and Korea will be very grateful to the US when the prisoners are released and will find ways to buy more product (agricultural, energy, military and aerospace) from the US.

China is simply trying to stay on the good side of the US because the intellectual property tariffs are a significant threat to its future. Xi has imagined China dominating industries that primarily rely on intellectual property.

In addition, Xi is trying to build a major trade corridor to the EU to diversity his exports away from the US so that he’s not so dependent on the US but Trump is threatening to bite into the funds he will have to complete OBOR. So China is cooperating on Korea but Korea is not a chip it can bargain with anymore because Trump has already taken that away with the sabotage of the last Korean nuclear test.

Trump is a genius. He knows his leverage very well. He knows that any reduction in the trade deficit is a major win for the US. He is not looking for the immediate balance of the trade deficits with the EU, China and Japan (and Korea). He’s looking for key concessions that will enhance his legacy such as increasing NATO contributions by EU countries in exchange for smaller reduction of the trade deficit. Chinese ending their assault on US technology industries in exchange for a smaller reduction of trade deficit. Japan buying more US autos or opening more car plants in US for a smaller reduction of trade deficit and so on.

NAFTA is all about credibility. Canada and Mexico will agree to terms. Mexico will pay for the Wall and Trump will win his noble prize!

BTW, don’t think Russia escapes this equation or Iran. Trump has all of them wrapped up in this. For Russia, Trump will make EU buy even more American energy and will get EU to fully fund NATO. As we speak, Pompeo is in the Middle East to rally up an Arab force to replace US troops in Syria and Iraq (and pay!). This is not good for Russia. It guarantees Syria will be split unless Russia agrees to a political settlement that has Assad gone from Syria. A stronger NATO and a EU now buying even more US gas and oil means less money for Putin’s military in Ukraine and Syria. And there’s no outlet to China because Trump is putting the squeeze on Xi. Multidimensional chess?

Iran is now in trouble too. That Arab force plus Israel is ready to strike. Trump has put the squeeze on EU (steel/aluminum), China (intellectual prop), and Russia (energy). The Iran deal will be redone and tougher sanctions will be enacted by US and EU for any violations of new terms. And military actions looms over their heads just as it did over North Korea. And BTW, the end of the NK nuclear program is a major blow for Iran since it essentially was continuing work on nukes through NK (Pakistan needs to be watched but it seems Trump is on top of them too).

That Trump has been able to wield this much power in so short of a time is mind blowing. If he’s able to pull all of this off in two years, he’ll already be a top 5 POTUS! MAGA!!

(LINK)

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This entry was posted in ASEAN, Big Government, Big Stupid Government, China, Donald Trump, Economy, European Union, France, India, media bias, N Korea, NAFTA, President Trump, Secretary of State, Secretary Pompeo, Trade Deal, Uncategorized, US dept of agriculture, US Treasury, USA. Bookmark the permalink.

79 Responses to Trade Update: Wilbur Ross Joins China Delegation, Trump Extends EU, NAFTA Steel Tariff Exemption 30 Days…

  1. ForGodandCountry says:

    “That Trump has been able to wield this much power in so short of a time is mind blowing.”
    ————————–

    Actually, it shouldn’t be to anyone really paying attention and understands that economics is a vital part of national security, and vice versa. (Read: The President is getting a LOT of highly experienced, expert, genius-level help).

    Sincerely,

    James Mattis, Sec. of Defense
    Adm. Mike Rogers, Director – NSA
    Gen. Mike Flynn
    Etc
    Etc

    Liked by 12 people

    • Cisco says:

      My 2 cent’s.
      Instead of filling his cabinet with eggheads, loooong on theory, but waaaay short on practical experience, President Trump has appointed people that simply put…
      Know what the “Eff” their doing.

      Liked by 24 people

      • And therein lies the difference.

        Liked by 6 people

      • He promised “killers” while campaigning.
        He delivered.

        Liked by 12 people

      • billrla says:

        Cisco: Right on. Real-world doers instead of academic know-nothings who cannot negotiate themselves out of a paper bag.

        Liked by 8 people

      • ForGodandCountry says:

        Exactly so.

        That said, would it shock you to learn THEY recruited Trump and not the other way around?

        Liked by 1 person

        • Charlie says:

          Expected but curious about the “they”. How long were they courting, what turned the ship?
          WHCD with BO? Never forget BO’s BS at WHCD he made Michelle Wolff look like a piker.
          Hope to live long enough to witness BO in chains and pink boxer shorts (love Sheriff
          Joe).

          Liked by 4 people

        • lokiscout says:

          Wouldn’t surprise me. I also read something a few months ago that Miliary Intel Community recruited him after a thorough background investigation.

          Don’t ask for a link. I couldn’t find it again if I wanted to.

          With what I have observed over the past 3 years I don’t think anyone recruited “The Donald”. President Trump sets his own agenda and makes his own decisions. I believe he decided many years ago he had something to give and when the time came and the country was continuing on a 30 year long course to destruction he pulled the pin. In the meantime he built his business, raised his family and let his Sons develope to the point they could step in and run the Trump International Company he had built.

          I think he might have ran in 2012 but like many of us he didn’t believe the Country could be fooled twice and probably didn’t think Romney would fold like a banquet dinner napkin. Of course a Romney win in 2012 would have meant no President Trump. Running at 70 is amazing (ask me I have been there). Running at 78 impossible.

          Thank you Mit!

          Liked by 3 people

      • Some replacements in cabinet picks, etc. CAN YOU BELIEVE THIS FROM THE WH???? These whiz-kids can’t use Google???
        “On December 7, 2016, Governor Branstad announced that he had accepted the nomination from President-elect Donald Trump to serve as Ambassador of the United States to the People’s Republic of China. He was confirmed by the Senate on May 22, 2017, and was sworn in on May 24, 2017.”

        Like

  2. dufrst says:

    Whoa! I’m honored Sundance! Thanks for your economic posts which I greatly enjoy among your many works!

    But I am further floored by the fact that deals have already been struck with Australia, Argentina and Brazil! Wow! This is a very mean, green fighting machine this Trump economic team!

    Trump is a game changer and when he says he’s over delivering on the promises he’s made, on trade there can be no doubt about it! Who needs Congress when you have a President who is single handedly bringing in billions of dollars to the US in the form of GDP growth by renegotiating trade deals and pacts?

    The Noble Prize will be nice but this trade turnabout is simply stunning and terrific! MAGA!!

    Liked by 18 people

    • Marygrace Powers says:

      Loved your overview/synopsis. Well done.

      Trump will go down as the greatest President
      in American History. He is just getting started.

      Liked by 13 people

    • Minnie says:

      Trump Train is plowing through, best get onboard or get out of the way 🚂

      Liked by 3 people

    • Perfectly-well deserved, Durfst!

      Liked by 4 people

    • I was asking myself earlier today, “what trade deals have we actually completed”.

      President Trump never disappoints!

      Nobel Prizes for President Trump:
      • Peace Prize: As he said today, “Peace IS the Prize”
      … for ISIS, Syria, Korea, Iran, Palestinians, Venezuela, Radical Islam, Terrorism
      … after Obama made the Nobel worthless.
      • Economics Prize: Trumponomics and Reciprocal Trade have “Changed the World”.
      • Physics Prize: President Trump terminated the Climate Warming Hoax upon humanity.
      • Literature Prize: President Trump’s “The Art of the Deal” revolutionized Geopolitics.
      • Humanity Prize [Next]: President Trump wipes out Drug Cartels and Human Trafficking.

      Liked by 4 people

    • A2 says:

      “deals have already been struck with Australia, Argentina and Brazil”.

      Not yet confirmed. As SD points out, “agreement in principle” (though I see no reason why it will not be confirmed).

      As for the steel/ car tariff wars with the 28 members of the EU, if they agree to lower car tariffs that per WTO rules means it will have to be extended to China (WTO member) and very keen to break into the EU car market. This may not be a problem as consumer choice comes into play.

      China has already announced they will not discuss the biggest demands on the US side in the upcoming meetings as those demands specifically target their new ‘made in China 2025″ strategy. China sees this as a direct attack on their economic development aka ‘dominance’.

      Sec Mnuchin has one very strong ace up his sleeve if he choses to use it: sanctioning China’s big three banks (BOC, Agricultural Bank of China and China Construction Bank) for money laundering for the DPRK against both UN and US sanctions (approved already by Congress). These activities were laid out in specific detail by the experts report to the UN.

      This may get them to move on the contested trade disputes. It would also serve as a warning to both China and the DPRK that the US means “complete, verifiable and irreversible deneuclearization’ that somehow seems to have got lost in the media of SK and elsewhere under the ‘sunshine 3” glare.

      Liked by 9 people

      • dufrst says:

        Nice post. Much more work to be done. We can’t take the hard work the Trump team is doing on our behalf for granted!

        Liked by 2 people

      • lokiscout says:

        The deal with Australia should have been pretty easy since they are one of the few countries we have a trade surplus with. Running in the 10 Billion range in recent years. They may want us to reduce that a tad! 🙂

        Like

  3. 6x47 says:

    Awww … Kudlow doesn’t get a wolverine? Maybe a groundhog?

    Liked by 1 person

  4. SharkDiver says:

    I have a serious man-crush on Trump!!! TRUMP2020 Baby!

    Liked by 7 people

  5. The Boss says:

    I hope I’m speaking for most of America when I say I’m sleeping well tonight.

    Liked by 13 people

  6. All Too Much says:

    OT. Justice IG filed report today reading FBI agent and a federal investigation.
    No names, no specifics. Posting here because its the most recent SD post.

    https://oig.justice.gov/reports/2018/f180430.pdf

    Liked by 3 people

  7. WSB says:

    SD, I am confused but this,

    “He’s looking for key concessions that will enhance his legacy such as increasing NATO contributions by EU countries in exchange for smaller reduction of the trade deficit.”

    This sounds like baby steps for the US. Why would we be asking for an increase in NATO for smaller reductions in trade deficits?

    Why are we not asking for each country to pay their complete share for NATO, AND and balancing their deficits 100%?

    I mean, even if these countries just did that, we still are not compensated for the past years of stealing and the US losing…

    Liked by 3 people

    • WSB says:

      And please exchange ‘but’ for ‘by’…

      Liked by 2 people

    • ForGodandCountry says:

      A: Because…as powerful as he is…Trump is in the early stages of winning support and converts internationally. Think: progressive. He can’t get it all in one go, and would be foolish to try. He can’t afford to act like a global dictator and win sincere, lasting support across the globe.

      Liked by 9 people

      • WSB says:

        I guess I am not patient enough. We are paying to prop up socialism for the rest of the world. For 3% of every socialist economy, we get screwed on trade as well?

        Grrrrrrr…..

        Liked by 2 people

        • ForGodandCountry says:

          I get it…and deeply empathize. But what has been put into place over multiple decades is gonna take some time to undo. It just is.

          Liked by 3 people

          • WSB says:

            Well then, I am going to have to start stealing glitter at Christmas markets in Germany. LOL!

            Liked by 2 people

            • Cuppa Covfefe says:

              Sad to say, the Weihnachtsmärkte here in Germany have gotten a little dangerous the last few years, thanks to our Kulturelle Bereicherung (cultural enrichment) coming from points south…

              Then again, it could be enough of a distraction for you to pinch the glitter unscathed 🙂
              (And don’t forget the Lebkuchen, especially in Nürnberg and the Stollen from Dresden)…
              (Nice train stations there, if you’re a trains fan).

              Liked by 1 person

        • Janie M. says:

          WSB, “Patience, grasshopper.” Temper your impatience with the thought of the state of your life if killary had managed to cheat her way into the WH. We’d all be in a world of hurt.

          Liked by 4 people

        • President Trump – as has been posted recently – goes for IMPROVEMENT over VICTORY.

          This year, he’s forming Trade Deal Partnerships and Architecting Frameworks [like Development Projects].

          Initial Deal Structures would include Annual Milestones, Performance Reviews and Consequences for Shortfalls.

          They can become Evolving Deals [like Real Estate Initiatives], with Biannual Resets to improve Tracking, Adaptive Protections and Enforcement.

          Liked by 4 people

  8. fleporeblog says:

    I watched both interviews with Maria B. And Secretary Mnuchin. Maria B. tried to poo poo the Economic Growth going forward. She was stating that Economists think real GDP for next year will be 1.75% and in 2020 1.5%. She was surprised by Mnuchin’s comeback. He stated that those same Economists predicted under 2% real GDP as the new norm and that under President Trump, we had 2 Quarters in 2017 at or over 3% and the 4th Quarter ar 2.9%. He slapped her around about the 1st Quarter coming in ar 2.3% because that quarter is adjusted for seasonal expenditures (he should have told her that over the last 9 years, Quarter #1 has averaged a real GDP of 1.2%).

    He was very confident that the will achieve 3% real GDP growth for this year and more importantly they will sustain it going forward. There is a reason he is ABSOLUTELY RIGHT and the Economists are COMPLETELY WRONG.

    Here is why:

    1) As SD pointed out above, 2018 will be the year of taking care of bilateral trade deals with a majority of the world that trades with us and we trade with them. Even if at the end of the day we are able to save $200 Billion from the deficit, that alone would be a major difference in GDP (it maybe an entire 1% to 1.5%).

    2) We are on the cusp of going ALL in on Energy production. Over the next two years, we will have multiple refineries up and running. By 2023, we will be the biggest producer of Energy in the world. Overtaking Russia. This will allow us to sell our Energy all over the world. Our oil is much easier to refine in other countries compared to Russian, Iranian, Venezuelian and others oil producing countries oil.

    3) The sanctions on Iran 🇮🇷 is going to be crippling. They will not be able to sell their oil. Our President will make it clear you either trade with them or us. Choose wisely.

    4) Businesses will continue to pour back into our country. They will continue to expand. Energy prices are high right now but will be coming down drastically in the USA 🇺🇸 once our refineries are up and running. This will give companies that manufacture in America an advantage over manufacturing elsewhere. This will further eat into the deficit. Instead of saving $200 Billion (as stated above), we will be saving $350 to $400 Billion and picking up that extra money by producing in our country.

    Now you are talking about 3%+ real GDP on that fact alone. Add another 2% for the other factors Economists are predicting and you have Annual real GDP of 5%+ a year starting in 2021!

    Mnuchin basically said it today without saying it! He would have also said, “ You can take that to the BANK”!

    Liked by 13 people

    • fleporeblog says:

      Liked by 7 people

    • WSB says:

      I watch these interviews very carefully, Felice!

      The one comment that is never spoken is, “In response to any high tariff imports, we will begin to manufacturer domestically.”

      My only concern is if our union rates of fabrication out weigh imports plus shipping and tariffs.

      BTW. I just found a Virginia source for fabricating a small order of custom metal stacking chairs rather than a Chinese source. Whoot!

      Liked by 9 people

    • Flep, we can concurrently expect President Trump to hammer down in 2019 to eliminate Government Waste, Fraud and Abuse. He’ll set incredible goals as he did with the Kill 2 to Add 1 requirement for Regulatory Reduction.

      He’ll be returning the Unemployed to the Workforce by 5-10 million per year, producing additional massive Cost Reductions.

      His Infrastructure Plan will dramatically shift both maintenance and development spending from the public sector to the private sector.

      By his second term, he’ll be devolving Federalized services back to the States, eliminating Federal Government Unionization, privatizing services like the USPS and shifting non-military workers from Federal Pensions to 401Ks.

      After the Mid-Term Elections in 2022, he’ll be in a position to restructure Social Security by introducing 401Ks for “younger America”.

      Liked by 4 people

  9. MakeAmericaGreat says:

    What Trump is doing is stunning and historic.

    Imagine what he could have done had he not had to face down a Coup upon entering office?

    Still much to do, but things are looking better by the day.

    Liked by 8 people

  10. Mike diamond says:

    Thanks Sundance for all you do for us !! And Right On Wilbur Ross!!!

    Liked by 4 people

  11. Robert Smith says:

    Ditto on the AF2 comment.

    Liked by 2 people

  12. President Trump’s Asia Negotiating Team is likely “Setting Trade-Deal Preconditions”:
    [Reposted]
    • COMPLETE the Korean-Peninsula Denuclearization
    … maintaining Maximum Sanctions
    • TERMINATE End-Run Exports (Steel, Auto, Industrial, etc.)
    … starting with NAFTA
    • ELIMINATE Import Obstacles
    … demonstrated by hassle-free Imports from America
    • REVERSE thefts of Intellectual Property
    … ending Chinese forced-transfers and business use of stolen IP
    • DISCONTINUE Currency Manipulation
    … leveling the playing field
    • CONTINUE to expect PUNITIVE TARIFFS
    … until the Preconditions above have been met

    Then we can entertain China’s Trade Proposals on how they will “Settle Up”:
    • RECIPROCATE on Tariffs [after letting them BITE]
    … by ending Import Barriers
    • EXPAND Imports
    … of American Food and Energy
    • CUT America’s Trade Deficit with China
    … by $100 Billion in 2019 and matching that reduction annually until we’re EVEN.

    For every $100 Billion in Trade Deficit Reduction GDP grows 0.5%!
    … Ending the $600 Billion Deficit with China adds 3% to GDP!!!

    Liked by 4 people

  13. White Apple says:

    Always interesting the blank stare when one asks, “If not Trump then who?”

    Liked by 5 people

  14. Minnie says:

    The Master Planner 🦁

    The Master Negotiator 🇺🇸

    The Master Very Stable Strategic Genius of President Donald J. Trump ❤️

    Well played, sir 🇺🇸🦁🇺🇸

    America First!!

    Liked by 6 people

  15. Pam says:

    Liked by 2 people

  16. Pam says:

    Liked by 3 people

  17. Chris Four says:

    Latest forecast: 4.1 percent — April 30, 2018

    The initial GDPNow [Atlanta Fed] model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2018 is 4.1 percent on April 30. The advance estimate of first-quarter real GDP growth released by the U.S. Bureau of Economic Analysis on April 27 was 2.3 percent, 0.3 percentage points above the final GDPNow model nowcast released on the previous day. Today’s update incorporates modifications to GDPNow’s dynamic factor model as described here. The dynamic factor is used to forecast yet-to-be released monthly GDP source data. The modifications to the factor model are intended to partially dampen some of the volatility in GDPNow forecasts in the early part of each month.

    Liked by 4 people

  18. Justice Warrior says:

    Wow! I’m so grateful for this brilliant President!

    Like

  19. Paul Killinger says:

    The above mentioned nations can all buy OUR domestically manufactured vehicles too, which consumers report are some of the best built in the world.

    While for patriotic reasons their citizens have historically chosen not to, these countries have large public sectors that buy cars and trucks in bulk.

    Like the trade deal we made recently with S Korea which included the sale of 25,000 US made vehicles per year there, they just need reasons to “want to.”

    Liked by 1 person

  20. Leroy says:

    President Trump reminds me of Tom Sawyer. M A G A

    Like

  21. The Devilbat says:

    Justin Trudeau is NOT a failure. He like Obama is a communist. who has worked tirelessly to deconstruct the North American economy. Both of these men have actually been very successful in what they were trained to do. Communists, yes. Failures, no.

    Liked by 2 people

  22. Mike13 says:

    I would not be this optimistic on Mexico. Look, there is a real possibility that failed state like Mexico with its rampant corruption and crime will elect a communist as its president July 1st. This is a real issue and fundamental problem is – Mexicans think of reconquest of southwest US as their manifest destiny. This will be a war that will have to be fought, and war is a major issue. But even deeper is fundamental turning of America against illegal immigration – and for end of legal immigration if fabric of America is to survive.

    Like

    • Chanter says:

      Totally optimistic. First time in decades. Think Pancho Villa. Do you think POTUS has not already put JSOC intervention into Mexico against the cartels into the equation? Whatever kinetic response POTUS deems necessary in Mexico will be done and the Mexican people will cheer. If you predicate your view on information gleaned from the Mexican press, be aware that the MEX-MSM is as corrupt and left wing as the US-MSM, so what you hear and see is what they want you to hear and see. The Mexican people are under siege in their own country and they are powerless to do anything about it. Do you think that placing National Guard on the southern border is only about the Wall? Your statement regarding immigration is unclear. Suffice to say, WE decide who we let into our great country, not any other country, and do not forget, POTUS laid a very generous DACA offer on the table for the Democrats to scoop up and they outright refused. This indicates that the real issue is not about immigration, but about something else, which people like Sundance will decipher as we get more information on the unfolding saga of MAGA.

      Like

  23. dayallaxeded says:

    “Trump will win his noble prize!” I see what you did there! No whiney TNT-guilt-driven, BS, valueless medals–VSGPDJT gets the NOBLE prize–“Well done, my good and faithful servant!” May it be God’s will and may He guard and guide VSGPDJT, his Killahs, and all family, friends, and supporters! AMEN!

    Like

  24. dayallaxeded says:

    And he doesn’t just “get” or “win” his noble prize–he earns it!

    Like

  25. reverence1 says:

    Each day I am at awe about the unfolding of events.
    I live in Germany and work in a very “deplorable” position. Hard work and low wages (but: they already went up!). I cannot even blame the owner of the company I work for, because I know the restraints he has to put up with. I do blame the current international trade system.

    Thanks to all who are part of this gathering.

    Like

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