With the U.S. election approaching, President Donald Trump has again raised the idea of separating the U.S. and Chinese economies, also known as decoupling, suggesting the United States would not lose money if the world’s two biggest economies no longer did business.
“So when you mention the word decouple, it’s an interesting word,” Trump said at a news conference at the White House in which he vowed to bring jobs back to America from China.
“We lose billions of dollars and if we didn’t do business with them we wouldn’t lose billions of dollars. It’s called decoupling, so you’ll start thinking about it.
Trump, who long publicized friendly ties with Chinese President Xi Jinping, as he sought to rebalance a massive trade deficit, has made getting tough on China a key part of his campaign for re-election. He has accused his Democratic opponent, Joe Biden, who leads in most opinion polls, as being soft toward Beijing.
The president painted his Democratic rival as a “pawn” of Beijing, saying the former vice-president will “surrender our jobs to China, our jobs and our economic wellbeing”.
“If Biden wins, China wins, because China will own this country,” he said.
Biden for his part has criticized Trump’s Phase 1 trade deal with China, saying it is “unenforceable,” and “full of vague, weak, and recycled commitments from Beijing.”
The president also threatened to block companies that outsource jobs to China from receiving federal contracts, and vowed to bring manufacturing jobs and crucial supply chains back to the US.
“We will make America into the manufacturing superpower of the world and will end our reliance on China once and for all. Whether it’s decoupling, or putting in massive tariffs like I’ve been doing already, we will end our reliance in China, because we can’t rely on China.
“We will bring jobs back from China to the United States and we will impose tariffs on companies that desert America to create jobs in China and other countries,” he added.
Mr Trump has said the US would hold China accountable for the devastation created by the coronavirus pandemic, which has killed more than 181,000 people in the US. In recent months his administration has taken aim at Beijing over a host of issues worsening tensions between the two countries.
U.S. Treasury Secretary, Steven Mnuchin has said that a decoupling of the U.S. and Chinese economies would result if U.S. companies were not allowed to compete on a fair and level basis in China’s economy.
Other officials and analysts have said that the two countries’ economies are so intertwined as to make such a move impractical, but Washington would continue to pressure Beijing to level the playing field.
Mr Trump and Mike Pence, his vice-president, used the Labour Day holiday to depart from their campaign’s focus on imposing “law and order” and cracking down on civil rights demonstrators to offer an economic message: the virus will be contained soon, and the economy has started to recover.
