China announced on Friday that it will raise tariffs on U.S. goods from 84% to 125%, the latest development in a back-and-forth trade war between the world's two largest economies and one that has shocked markets and raised fears of a global economic slowdown.
Jason Oxman, president and CEO of the Information Technology Industry Council, which represents the world's most innovative tech companies, spoke with Scripps News about the burgeoning trade war and its likely effects.
"The concern here is that the trade policy needs to focus on a long-term strategic goal of entering into actual trade agreements. And that's where we hope the president will be focused moving forward," Oxman said.
"95% of the world's consumers live outside of the U.S. So for the economic success of American companies, having access to global markets is incredibly important," Oxman said. "If we can move forward to entering into trade deals with our partners around the world, that would be great for U.S. manufacturing. Great for U.S. innovation, great for U.S. job creation."
RELATED STORY | China strikes back: New tariffs on US goods as trade war intensifies
China responded in the trade war with the United States earlier this morning, announcing it would raise tariffs on U.S. goods from 84% to 125%. A Chinese finance official stated that President Donald Trump’s most recent tariff increase on China to 145% "won't create any economic damage" and suggested it will become a "joke in world economic history."
Lin Jian, China's Foreign Ministry spokesperson, said China will simply ignore any future escalations in the trade war by President Trump, "given that U.S. exports to China are already commercially unviable."
This has the potential to increase prices for consumers and rattle the international connections that deliver goods.
"Certainly companies are going to have to make decisions on their pricing based on the input costs of those units. You noted televisions as an example, televisions have not been manufactured in the United States for many, many decades. And it's a reminder that supply chains are global," Oxman said. "I haven't heard any companies announced that they're going move television production back to United States. But I think that's an example of how U.S. consumers benefit from those global supply chains."
Oxman said he would prefer to see the U.S. take a more cooperative approach as new trade paradigms develop.
"Tariffs are a tool and in some cases can be useful. But they are no replacement for trade agreement. So the ideal scenario, as you noted, is we get back to negotiating trade deals with our partners, so that the EU and other international partners around the world see the United States as an ally in economic relations and that U.S. companies have access to those international markets."
Watch the full interview with Oxman in the video above.
