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Offbeat Trump's China trade bashing gives new hope for NAFTA progress

01:07  12 july  2018
01:07  12 july  2018 Source:   cnbc.com

Largest US business group attacks Trump on tariffs

  Largest US business group attacks Trump on tariffs The U.S. Chamber of Commerce, the nation's largest business group and customarily a close ally of President Donald Trump's Republican Party, is launching a campaign on Monday to oppose Trump's trade tariff policies.With some of America's tightest trading partners imposing retaliatory measures, Trump's approach to tariffs has unsettled financial markets and strained relations between the White House and the Chamber.

Trump has said he would like bilateral trade talks with Canada and Mexico, so that may be an agenda item for the U. S . NAFTA talks were put on hold until after the Mexican election July 1, and it was assumed there would be no progress until after the U. S . midterm elections in November.

Given this, no single country has the power to force China to reform its ways, the thinking goes. A version of this article appears in print on , on Page A10 of the New York edition with the headline: In Getting Tough on Chinese Trade , Trump Risks Alienating Allies.

Mexico's National Regeneration Movement (MORENA) presidential candidate, Andres Manuel Lopez Obrador © Provided by CNBC Andres Manuel Lopez Obrador U.S. officials are visiting Mexico Friday, adding to speculation that the Trump administration may be looking for a victory on another trade front while tensions escalate with China.

"We believe the administration is looking to cut a deal on NAFTA or some deal on zero tariffs for autos," said Dan Clifton, head of policy research at Strategas Research. "We believe that of the two, NAFTA has a better shot at conclusion."

Secretary of State Michael Pompeo will be in Mexico on Friday meeting with the current president and the president-elect of Mexico, Clifton noted. 'It's worth keeping an eye on since so much work has already been done on NAFTA."

Peso falls after leftist wins Mexican presidency in a landslide

  Peso falls after leftist wins Mexican presidency in a landslide The Mexican peso fell against the U.S. dollar on Monday after voters in the second-largest Latin American economy overwhelmingly voted in favor of a far-left candidate as its new president. The peso pulled back 0.6 percent versus the dollar, erasing slight gains seen on Sunday, to trade at 20.032.Andres Manuel Lopez Obrador, better known by his initials AMLO, received more than 50 percent of the vote in an election held Sunday. His two closest rivals only got about 23 percent and 15 percent of the vote respectively.His victory, however, could lead to tougher negotiations between Mexico, the U.S.

U. S . trade relations with its partners appear to be hitting rock bottom, ahead of possible new tariffs on China and continued worries that Trump will withdraw from NAFTA . Progress appeared to be made when the White House struck a deal to allow China ' s ZTE to resume buying U. S . components even

Mr. Trump met with his Chinese counterpart, Xi Jinping, in Beijing on Thursday, offering personal praise and qualified criticisms of China ’ s trade The two sides also pointed to what they claimed were billions of dollars of deals between Chinese and American companies to show face-saving progress .

Pompeo and White House adviser Jared Kushner, President Donald Trump's son-in-law, are expected to travel to Mexico City to meet incoming president Andres Manuel Lopez Obrador. Treasury Secretary Steven Mnuchin and Homeland Security Secretary Kirstjen Nielsen also will be attending a meeting with Lopez Obrador at his campaign headquarters, according to news reports.

"We know Lopez Obrador would want to move forward and modernize NAFTA. It could be a talking point. It's probably being discussed, but I don't see that as the most critical issue on the agenda," said Juan Carlos Hartasánchez, Albright Stonebridge Group senior director. He said security and immigration are likely higher on the agenda.

With the administration's latest batch of tariffs against China still stinging markets, some think the administration will not want to wage trade wars on all fronts and could move to resolve disputes with the European Union or with Canada and Mexico over revamping NAFTA. The visit Friday could be a warm up for renewed talks on the North American Free Trade Agreement.

Trump says China could face more than $500 billion in US tariffs

  Trump says China could face more than $500 billion in US tariffs Trump says China could face more than $500 billion in US tariffs|| 105253826First “34, and then you have another 16 in two weeks and then as you know we have 200 billion in abeyance and then after the 200 billion we have 300 billion in abeyance. Ok? So we have 50 plus 200 plus almost 300," Trump said.

The administration’ s desire to quickly resolve Nafta could give Canada and Mexico more leverage. Trade experts say a Nafta deal seems more likely than it has in months, since the United States sees new urgency to conclude talks and is at Trump Doubles Down on Potential Trade War With China .

The talks had "not made the progress that many had hoped in this round," US trade representative Robert Lighthizer said, adding that the US was prepared to "move on Read more: Auto giants launch new coalition to save NAFTA . While the new tariffs are clearly aimed at China , which the US and

"There's actually people getting optimistic on Mexico," said Jens Nordvig, CEO of Exante Data.

"I think what's happening on trade is we have this endless escalation against China, but I don't think we'll have an escalation on the other fronts," Nordvig said. "The push back against that is going to be extreme."

He added that the administration may be using a new found relationship with Mexico as a lever to pressure Canada.

Trump has said he would like bilateral trade talks with Canada and Mexico, so that may be an agenda item for the U.S.

NAFTA talks were put on hold until after the Mexican election July 1, and it was assumed there would be no progress until after the U.S. midterm elections in November. Canadian Prime Minister Justin Trudeau briefly spoke with Trump Wednesday on the sidelines of the NATO meeting. It was their first discussion since the G-7 meeting, when Trump withdrew from the communique because of Trudeau's comments on trade, according to news wires. They were said to discuss the new dynamic of trade talks with the inclusion of Lopez Obrador.

US-China tariffs: 'The first shots to the trade war are about to be fired'

  US-China tariffs: 'The first shots to the trade war are about to be fired' A trade war between the U.S. and China is about to start soon, and there will be probably be “escalation upon escalation,” warned Geoff Raby, Australia’s former ambassador to China. Ahead of the expected Friday implementation of American and Chinese tariffs, Raby told CNBC that “it looks like the first shots to the trade war are about to be fired.”China, for its part, was already calling the tariff threats between Beijing and Washington a "trade war" in June.“I thought that by now a negotiated solution would have been found,” he told CNBC’s Martin Soong, adding that it seems the U.S. has “walked away” from any potential deal.U.

After months of making little progress , recent statements from high-level trade officials As part of the administration' s legislative strategy, Trump could give the required six months' notice of withdrawal from NAFTA about the time a text is ready, essentially forcing Congress to accept the new accord or

Related: Trump and China : 2018 could get nasty. " China hopes the U. S . will exercise restraint in using trade restrictions," the The Trump administration is in the midst of talks with Mexico and Canada to renegotiate NAFTA , the free trade agreement that binds the three North American nations.

"Lozpez Obrador has tried to smooth the concerns of international investors and American companies but he hasn't really discussed much around immigration and security," said Hartasánchez. He said the president-elect, a sociailist, has also shown that he will work with the outgoing administration and that he's willing to speak with the U.S., both positives.

a close up of a map © Provided by CNBC

That has helped the peso recover, and it is now up 5 percent since election day and 8 percent since the middle of the month.

But Hartasánchez said he is skeptical much headway will be made on NAFTA. "It seems that everybody has kind of accepted that they are putting this off to November. What they might try to discuss is whether they can advance in the interim so they are in place to announce an agreement in November," he said.

Some MAGA hats made in China may increase in price because of tariffs .
A California-based company that sells "Make America Great Again" hats similar to the official hats sold by the Trump campaign says its prices may rise in response to trade tensions with China prompted by President Trump's tariffs.David Lassoff, who runs the company IncredibleGifts, told ABC News that prices of the hat could do uble from between $9 and $12 to at least $20 if he is forced to abandon his Chinese manufacturers and make the hats in the United States.The hat, Lassoff said, is his website's best-selling item. He claims to have sold hundreds of thousands of the hat."We usually sell the MAGA hats for around $9 to $12.

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