Donald Trump plays the carrot and stick with the Chinese

Donald Trump announces his stance. Chinese cars will be heavily taxed unless the Chinese come to build them in the United States.

The former president, once again a candidate, has committed to imposing discouraging tariffs of 100% on imports of Chinese cars, even those manufactured in Europe or South America. However, during a rally in Ohio on March 18, Trump opened the door to negotiation: “If they want to build a factory in Michigan, Ohio, South Carolina, using American workers, they can. They are welcome, right?” We will skip the usual verbal excesses that followed this announcement because with Trump, every good idea is immediately tarnished by a barrage of insults and threats…

So is this a madness or another foolishness from Trump? Not really, since this idea is not his but comes from Ronald Reagan, who invited Japanese manufacturers to come to set up shop in the U.S. in the 1980s. At that time, Japan was the major automotive power, and its manufacturers responded favorably to this call. Since then, they have not left, creating millions of jobs. The Toyota Camry has even become one of the best-selling models in the United States. No American driver, even in the most conservative states, feels guilty driving a Japanese Pickup.

Trump offers with one hand to take with the other

The United States may never be able to match the combination of skilled personnel, infrastructure, and massive economies of scale that China has, at least in the short term. So it is easier to let Chinese companies import their technology to the U.S. than to try to catch up. This is a path of least resistance opened by Trump, but it is hard to imagine the Chinese falling into such a gross trap!

To summarize, Americans need Chinese technology, and the Chinese need new markets like the United States. Donald Trump and Chinese leader Xi Jinping appreciate each other, and in the event of the Republican leader’s re-election, the communication channel will run at full speed between the two countries. An agreement in the automotive sector could herald a broader thaw in economic relations between the United States and China.

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