"I think that tariffs do need to be used to get counterparties back to the table, especially China, which is not living up to all of the agreements they made in the Phase One trade agreement," Steven Mnuchin told CNBC.
He was referring to a 2020 trade deal that followed a truce in a tariff war between Washington and Beijing.
The agreement saw China pledge to boost purchases of American products and services by at least $200 billion over 2020 and 2021. But the target was not met amid the pandemic.
Mnuchin added Thursday that he would recommend Trump use tariffs in a "strategic way" to ensure there is not widespread inflation.
He noted that in his time in the Trump administration, tariffs were accompanied by exemptions for certain products US businesses needed.
Additionally, he said energy prices need to be lowered to keep consumer costs in check.
In his first term, Trump lowered the corporate tax rate to 21 percent and has since suggested lowering it further to 15 percent.
"If the corporate tax is going to be lowered, it should be lowered in a way that supports US manufacturing and US jobs as opposed to across the board," Mnuchin said.
He also suggested that countries like Iran and Russia could see sanctions intensify.
"In the case of Iran, they're now selling millions of barrels of oil, which needs to be stopped," said Mnuchin, who is founder of Liberty Strategic Capital.
US firms at China trade fair upbeat on Trump future
Shanghai (AFP) Nov 7, 2024 -
American businesses at a major Shanghai trade fair said Thursday they were optimistic about US-China commerce under a second Donald Trump presidency, despite his tough rhetoric on tariffs raising fears of a new trade war.
During his campaign, the Republican pledged to slap 60-percent duties on all Chinese goods entering the United States, which could see the world's two largest economies embroiled in a repeat of the bruising contest that marked Trump's first term.
Beijing could retaliate by cutting imports of US agriculture and energy products, as well as limiting exports of critical rare earths, among other measures, an ANZ Research report released Thursday said.
But speaking to AFP at the China International Import Expo (CIIE), many firms maintained they were upbeat about their sector's prospects.
United Soybean Board chairman Steve Reinhard said he believes a Trump administration will mean renewed efforts to increase agriculture purchases by Beijing.
"When Trump was elected president the first time, they had the negotiations with the phase one trade deal and both parties agreed to that deal and it worked rather well," he said.
Reinhard was referring to an agreement struck between Washington and Beijing in 2020, intended to alleviate tensions caused by the trade war, that included a pledge for China to buy $32 billion of US agricultural goods.
Reinhard said he felt that under Joe Biden's presidency, agricultural trade with China had "not a lot of attention paid to it".
- 'Unfair tariffs' -
Angel Zhang, president of Californian wine seller Evo Wine Group, told AFP she hoped Trump would not act on the bold rhetoric that he used on the campaign trail.
"I think before the election he said some things, but after the election, it'll probably (be time for) a serious solution," she said.
Zhang said she felt that Beijing's tariffs of up to 93 percent on American wine in recent years were "unfair", but the Biden administration "didn't do anything to try to improve (the situation)".
"The situation now is very critical for us," Zhang said.
Elisa Daun, an international trade expert at Washington state's Department of Agriculture, said she hoped the federal government under Trump would negotiate tariff exemptions for an increasing number of product categories.
"I think regardless of the election results... the tariff situation will be continuing," she said.
"Hopefully (the federal government) will step up to give assistance," Daun said, saying that firms were currently struggling individually to process tariff exemptions when doing business with Chinese partners.
Trump's term will likely be shaped by the unpredictability caused by his "propensity for inconsistent policy positions," Ali Wyne, a US-China expert at International Crisis Group, told AFP.
While Trump has threatened to raise tariffs on Chinese goods, he also seems "interested in a grand bargain with Xi that could, at least in theory, yield a more balanced economic relationship between Washington and Beijing", Wyne said.
Others are confident their companies are flexible enough to weather the uncertainty.
Liliana Lucioni, China president for American handbag maker Coach, told journalists on Wednesday she thought the firm's robust and diversified supply chain would shield it from the impact of potential trade tensions.
"I don't foresee any disruption, knowing how we are organized and our agile we tend to be," she said.
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