BEIJING, April 15. /TASS/. With his policy of massive tariffs, US President Donald Trump is hurting the business landscape in the country, pushing additional costs on to American companies, Zhou Weidi, Deputy Head of the Institute of Economics and Business Administration at the Central China Normal University (Wuhan), said in an interview with TASS.
"Trump wants to solve the employment problem in the United States via his ‘America First’ campaign. This will undoubtedly lead to an increase in costs for American companies, because the US has an expensive labor force," the expert said.
"Indeed, the American position can be seen as hegemonic and contrary to international conventions, which will damage America’s standing in the global arena," the expert added.
As Zhou Weidi specified, Trump's "tariff hammer" will, in theory and in practice, hinder the efficient allocation of resources and division of labor. The expert recalled that high-tech industries in the United States are largely dependent on imports from China.
"In the short term, it will be very difficult for the United States to make it [to ensure import substitution from China], because China has formed integrated supply chains, the abandonment of which will lead to a surge in the cost of American products and a clampdown on consumers," the expert explained.
Zhou Weidi believes that China will take countermeasures aimed at both the agricultural and manufacturing industries in the United States. Thus, "American soybean and corn producers will be harmed," he said.
The expert added that Trump's measures will also prompt retaliatory measures from Canada and Mexico.
On April 2, Trump unleashed a large-scale trade war by announcing additional tariffs on goods from 185 countries and territories. In relation to China, the tariffs were set at 125%. Since April 12, Beijing has applied tit-for-tat measures to American products. Earlier, the White House adjusted its decision, canceling tariffs on Chinese smartphones, computers, equipment for the production of semiconductors and integrated circuits.