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The U.S. can be ‘smart’ to chop tariffs on China, says former commerce negotiator

Larger U.S. tariffs on Chinese language items damage American companies and shoppers, and it might be “smart” to chop these levies, a former American diplomat and commerce negotiator mentioned Thursday.

If each international locations had been to scale back tariffs on one another, their relationship might enhance, mentioned Frank Lavin, a former U.S. ambassador to Singapore and undersecretary of Commerce for worldwide commerce.

He informed CNBC {that a} “mutual discount” in tariffs would additionally permit the U.S. to handle longstanding considerations about China’s commerce practices.

Lavin was requested what recommendation he would give to the Biden administration on its coverage towards China.

“I might say do not step away from the problem, there’s some critical commerce points there and I believe quite a lot of President Trump’s criticisms had been legitimate so do not drop that agenda,” Lavin, now chief govt and founding father of consultancy Export Now, informed CNBC’s “Road Indicators Asia.”

Flags of the U.S. and China displayed on a desk forward of a gathering.

Jason Lee | AFP | Getty Photos

“However I do suppose that in the identical breath it might be smart to take away the tariffs as a result of the tariffs damage American companies, American shoppers, American employees simply as they damage the Chinese language economic system,” he added.

U.S.-China commerce tensions escalated underneath former President Donald Trump, with either side slapping increased tariffs on one another’s items value billions of {dollars}. The commerce dispute has since spilled into know-how and finance.

President Joe Biden’s administration has signaled that it’s going to proceed to be powerful on China. U.S. Commerce Consultant Katherine Tai mentioned final week the administration is conducting “a complete overview” of its commerce coverage with China.  

Firms from the U.S. and different international locations have lengthy complained about unequal entry to the Chinese language markets, lack of mental property safety and compelled know-how switch.

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Chinese language President Xi Jinping has mentioned Beijing will proceed to work with different international locations and reduce tariffs — although he didn’t particularly point out the U.S. by identify.

Nonetheless, Lavin mentioned the U.S. might maintain Xi to his phrase in pursuing a discount in tariffs and improved relationship.

“So I might say if we will simply have a mutual discount in these tariffs, we’ll have a greater working relationship,” mentioned Lavin. “After which let’s begin tackling a few of these commerce points one after the other and assist China transfer to world norms.”

— CNBC’s Evelyn Cheng contributed to this report.

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