US Chamber chief says US not in trade war

U.S. Chamber of Commerce President Tom Donohue said Wednesday that he does not believe the U.S. is in a trade war, despite the 10 percent tariff that President Trump announced this week on $200 billion in Chinese imports.

China fired back on Tuesday with tariffs on $60 billion in U.S. goods, while Trump has threatened to tax all Chinese imports to the U.S.

Donohue said a prolonged trade war would be catastrophic to the global economy, but said he didn’t think it had actually started yet.

{mosads}“The single greatest threat facing the economy is a real trade war. I don’t think we’re there quite yet,” Donohue said during a Wednesday breakfast conference with reporters sponsored by the Christian Science Monitor, adding that he believes Trump would not allow mounting tariffs to decimate the U.S.

“I don’t believe that the White House thinks that it’s a positive thing to do,” he said.

The Chamber has fiercely opposed Trump’s tariffs on Chinese goods and imported steel and aluminum. The powerful business group says the taxes would harm U.S. retailers, manufacturers and consumers without curbing intellectual property theft and unfair trade practices from Beijing.

“The problem with tariffs is not the objective,” Donohue said Wednesday. “We should find other ways to do it that doesn’t negatively effect in such a significant way the American economy.”

Donohue said he was optimistic that Trump would find a path forward in trade talks with China despite concerns that the president and top aides were sending Beijing mixed messages.

He also said he hopes the administration will soon strike a deal to include Canada in the North American Free Trade Agreement (NAFTA) reboot it had agreed to with Mexico.

The U.S. and Mexico agreed to a new trade pact in August, but did not reach a deal with Canada. U.S. Trade Representative Robert Lighthizer and Canadian foreign affairs minister Chrystia Freeland have been locked in talks for weeks to bring Canada into the three-part deal.

Trump and administration officials say they’re willing to strike a deal with Mexico whether or not they can bring Canada into the pact. But any new NAFTA would be subject to congressional approval and lawmakers in both parties have spoken out against a deal that doesn’t include Canada.

Donohue said that Canada’s involvement in a U.S.-Mexico trade deal is of “fundamental” importance to the American economy, and that a deal without the northern neighbor would be unacceptable.

“I am hopeful that over the next few days we’ll be moving in the right direction,” Donohue said. “Otherwise in my opinion it’s not going anywhere.”