North Korea’s the keystone to China trade success

As I wrote recently, the Trump administration is making great strides in dealing with China and that a deal will happen.

So news broke Sunday that the US has suspended implementing the new tariffs scheduled for March 1 while continuing talks.

The ongoing North Korean talks figure prominently into this equation.

The loop-sided trade deals we have with China are so bad that the US could get many concessions and China will still have the upper hand on trade imbalances.

The Chinese have agreed to buy additional agricultural products including soy beans, not as a concession, but because they cannot source enough crops elsewhere to feed their people.

Global stock markets — with its typical knee-jerk reactions — jumped on the news of Trump delaying the tariff tiff. Just as the markets fell numerous times on bogus news that the draconian tariffs would kick in.

Now how the Trump administration is using North Korea as the keystone in its China trade talks are taking two tracts.

One the US trade representatives are telling China officials that Trump will open up North Korea to be a far cheaper manufacturer of American products, if we do not get fairer trade movement. However as a result it will put an end to North Korea hostilities on the Chinese border as the North Korean economy improves.

Secondly, the Trump team is pointing out to North Korean leader Kim Jong Un that his country will be able to thrive as the new American factory country just like his neighbors to the south.

These maneuvers come from someone with a business background, which is why the president snidely tweeted (below), “But thanks anyway!” to those who could not get this done over the last twenty years.

 

Advertisements