The Heat: US trade tariffs and NAFTA talks

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Given US President Trump came into office determined to change what he called “unfair trade deals”, after first threatening to withdraw from the North American Free Trade Agreement (NAFTA), he agreed to talks aimed at making changes to the pact.

Then, the US administration late on Monday announced tariffs on specific goods from China and the Republic of Korea. Saruhan Hatipoglu, CGTN’s global economics analyst talked the issue in a studio interview by CGTN program The Heat.

Saruhan Hatipoglu, CGTN’s global economics analyst /CGTN Photo

The tariffs have been imposed on solar panels and certain washing machines which will affect China and South Korea, mainly that’s where they manufactured. “The question is why these countries, why these specific goods and why now?” the anchor asked.

Saruhan explained it's due to a US trade deficit with those countries – a bad thing that needs to be taken care of.

However, “it is important to understand that such measures not only hurt global economy, but also will come back to hurt the US economy.” He noted.

“There is going to be a reaction if we think that China and South Korea are going to say Okay."

Solar panels / CGTN Photo

"This is part of the deal. We have a trade surplus with the United States. We understand what’s happening.” Mr. Hatipoglu said.

He thought this was just “fooling ourselves”. “So the question is the president is very confident in saying there won’t be a trade war.” He added.

Hatipoglu then said what China and South Korea would do, what decisions they would take since their exports were going to be affected by that at the end of the day.

As for the impact to the US solar power industry, “They’re using quite a bit of inputs. They’re selling to consumers. These costs are going to increase and will pass on American consumers and that’s going to hurt the industry,” he noted.

Hatipoglu concluded that this was a bad move in the long term while the President gained a lot of favor among his political base in the short term.