The ongoing ‘trade war’ between the United States and China has taken another turn as President Trump yet again chooses another point person to lead trade negotiations with China.
The G20 summit, which was held last week in Buenos Aires, was intended to solidify negotiations and trade deals between the United States and China, who have been engaging in a tit-for-tat tariff raising game since earlier this year.
The meeting did not yield the hoped for long-term resolution agreeable with Chinese President Xi Jinping, and President Trump decided to fire and hire another representative for the negotiations.
The newly appointed lead trade negotiator Robert Lighthizer was named on Monday to the lead position. The new appointment is said to have shocked Chinese officials who were agreeable to working with previous negotiation lead Treasury Secretary Steven Mnuchin.
Lighthizer is said to be critical of Chinese economic policies and has a bit of history opposing Chinese market expansion. Lighthizer was also a main support behind Trump’s decision to impose high tariffs on over $250 billion of Chinese imports. Referred to as “the missile man” after rejecting a series of proposals with the Japanese and supposedly throwing them back folded as paper airplanes, Lighthizer is a tough and relentless negotiator.
President Trump has assured that his has great confidence in Lighthizer due to his history of successful trade negotiations, like the updates of the North American Free Trade Agreement with Canada and Mexico.
Though the new appointment of another negotiation representative may indicate a swift and just end to the trade war, the economic disputes are not without consequences. Already, several company stocks have taken record-breaking hits as a result of economic slowdown following the high tariffs placed on needed and in-demand imports from China. Tariffs are expected to raise again following the New Year unless permanent agreements can be made by both sides.
While representatives of China and the U.S. left the G20 summit with optimism about an acceptable trade deal, there is still a lack of clarity that leaves many investors and companies extremely nervous in the weeks approaching even greater tariffs.
Many are skeptical that a concrete and realistic goal can be reached in such a short period of time when both sides have great stakes in the agreement process. If clear agreements aren’t made by March 1, the U.S. will experience even greater stock market drops and further economic slowdown.
Negotiations and talks between China and the United States are scheduled to start again in mid-December, though business owners and stockholders believe the trade talks cannot start soon enough to put to rest the lingering sense of uncertainty.
If a deal cannot be reached by March 1, President Trump has said that he will raise the tariffs on the remaining $267 billion Chinese goods imported into the United States. The economic backlash of further raises could be devastating to not only the U.S. and Chinese economies, but also the world trade network because of the influence and autonomy the two economic giants have in the global economy.
Eyes from all over the globe will be closely watching how Lighthizer leads the tense negotiation process with Chinese officials until a trade agreement is finally reached.