Trump’s new tariffs show he’s reading China all wrong - risk consultancy

U.S. President Donald Trump’s surprising move to impose more tariffs on China is a serious misreading of China’s pressure points, according to Eurasia Group analysts.

The latest escalation signaled a return to the way Trump negotiated with China — by trying to build more leverage over Beijing amid ongoing talks — before both sides agreed to a ceasefire in late June, Michael Hirson, Paul Triolo and Jeffrey Wright wrote in a Thursday note.

“The threat is a serious gamble for Trump,” they said. “It likely signals that he would prefer to reach a deal on his terms before the 2020 election, and is willing to use the tools at his disposal to build pressure on China to that end.”

Trump said Thursday that the U.S. will put 10% tariffs on another $300 billion worth of Chinese goods starting Sept. 1. The announcement came just a day after both sides wrapped up a round of trade talks in Shanghai, with plans to continue the negotiations in Washington in September.

The Eurasia Group analysts said it is possible that Thursday’s tariff threat is meant to spur China into buying more American agricultural products but, they added, Beijing is unlikely to respond the way Trump hopes. It would be “extremely embarrassing for China to step up imports from the U.S. under the threat of blackmail,” they wrote.