White House economic adviser Larry Kudlow said Sunday that trade deals being worked out will “outweigh any of the very small problems” in the U.S. trade war with China.
In an interview on CNN’s “State of the Union,” Kudlow touted a deal with Japan.
“Not only is there a successful trade deal being brokered with Japan, but we have a terrific deal with USMCA, partners in Canada and Mexico, which will add between half to 1% point additional GDP per year when the Congress finally enacts the law, hopefully this fall. That will way outweigh any of the very small problems with the China trade.“
Kudlow said the G7 Summit in France has been better than expected.
“The whole conference, including the unexpected luncheon between President [Donald] Trump and [French] President [Emmanuel] Macron, has gone very well. Better than we thought,” he said. “It was a very positive vibe. So I will go that far and say actually it's been a solid gathering.”
He also defended Trump’s controversial comment that he’d had second thoughts about an escalating trade war, suggesting the president didn’t accurately hear the question.
“So it was not to remove the tariff,” he said of his second thoughts. “He was thinking about a higher tariff response… we're staying with the policy that was announced on Friday, I believe, a 5% increase on the two tariffs, first 250 and second 300 September 1 and September 15…. the discussion between the China sides and U.S. side continues. Negotiations continue.”
He also batted back criticism of Trump’s order for businesses to leave China.
“I know he said ‘I hereby order,’ but what he said to them in effect is you begin to look or you begin to search for ways,” to leave, he said, adding, “There's no emergency powers being invoked right now. …He may. There's nothing right now in the cards.”
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