The CEO of China’s sovereign wealth fund said on Thursday he expects U.S. President-elect Donald Trump to be very careful in considering whether to increase tariffs in line with his election promises because it would not be in US interests. China Investment Corporation chairman and CEO Ding Xuedong said Republican Trump had used a number of “slogans” during the hard-fought campaign against Democratic rival Hillary Clinton that were purely for the purpose of getting elected.
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“Some of the slogans will be put into effect, for example, he’s going to cut taxes and increase spending and he’s going to increase investment in infrastructure and in this way to stimulate the American economy. I believe that’s possible,” Ding told the Boao Forum for Asia in Melbourne.
“But if he’s going to increase tariffs … and begin a trade war, then I believe it is against the globalisation trend and I believe that Mr Trump will be very careful in considering whether to put these measures in place,” he said.
Trump’s focus once he has taken office would turn to global trade and on increasing benefits to the United States from global trade, Ding said, and that he may find that raising tariffs would not work to that end.
“They may not be effective .. or (of) benefit to the U.S.,” he said.
Throughout the election campaign, Trump threatened China and Mexico with punitive tariffs that some economists have warned could spark a trade war that could potentially roll back decades of liberalisation. He also threatened to redraw trade deals, including the Trans-Pacific Partnership, which would be a blow to Japan’s export-dependent economy.