(Yicai Global) April 18 –- The US’s unilateral imposition of steep tariffs on Chinese goods undermines the multilateral trade system, which is crucial for global economic growth, said Joseph Stiglitz, a Nobel laureate in economics, strongly criticizing President Trump's policies on trade issues with China.
Speaking at the China Institute Executive Summit themed the US-China Business in the New World Order and held at the Harvard Club of New York City on April 12, Stiglitz called the approach taken by President Donald Trump to resolve trade disputes with China primitive.
"You cannot solve trade deficit overnight... actually it is stupid to do so," Stiglitz said, adding, "The US president’s moves toward an all-out trade war with China will result in a pervasive tax that will hit America’s poor hardest.”
Taking into account the US demands for further foreign investment in the world’s second-largest economy is feasible, Stiglitz suggested, as opening its financial market is in China’s best interests.
"If Trump wants to solve the bilateral trade deficit overnight, all that China would have to do is to buy $100 billion worth of US oil," said the Nobel-prize winning economist. "But whether China were to reduce its purchases from elsewhere or simply sell the US oil or gas on to other places, it will not reduce the bilateral trade deficit; it will not add jobs as the president emphasized; and it will not change anything in the world."
Stiglitz, who is also a university professor at Columbia University and chief economist of the Roosevelt Institute, a US think tank, and the author of Globalization and Its Discontents Revisited: Anti-Globalization in the Era of Trump, criticized the US president for trying to solve trade disputes bilaterally.
"The WTO [the World Trade Organization] provides the framework for adjudicating disputes. If the US thinks that they [China] are violating the WTO rules, you file a case. .... China is actually beginning to file cases against the United States, but what the US is doing on steel and aluminum is probably a violation of the WTO rules," said Stiglitz.
Founded in 1926, “China Institute is the oldest bicultural, non-profit organization in America to focus exclusively on China,” the institute says on its website. Its annual executive summit brings together hundreds of top US and Chinese chief executives, government leaders and experts to discuss China-related world issues.
Editor: Mevlut Katik