According to a report in German publication Der Spiegel, US President Donald Trump has charged Germans for cornering business and jobs in the US. While blasting Germans, Trump said, “The Germans are bad, very bad. See the millions of cars they are selling to the U.S. Terrible. We will stop this”. Donald Trump has been a vocal critic of trade imbalance between Germany and America that is largely tilted in German favour.
In January, he had targeted German carmakers BMW and Mercedes-Benz comparing their high sale volume in America with low sale volume of Chevrolet in Germany and had threatened to impose 35 per cent import tariff on BMW on its cars imported from its Mexican plant. But it is not only about German carmakers. In fact, data from the Wall Street Journal shows that apart from General Motors, with a market share of 17.1 per cent in April 2017 and Ford with market share of 15.1 per cent, the two largest automakers in the US, most other automakers in the top ten are foreign companies. i.e., Japanese Toyota has a market share of 13.5 per cent, German Chrysler has a market share of 12.4 per followed by Nissan’s 9.9 per cent, Honda’s 9.2 per cent and Hyundai’s 4.2 per cent.
In response to Trump’s criticism, German vice chancellor Sigmar Gabriel, Angela Merkel’s deputy, quipped that the US automakers needed to come up with better cars. He termed products of American automakers “worse, weaker and more expensive”, an Associated Press report said.
According to a Reuters report, the US has a trade deficit of $65 billion with Germany, its third largest negative trade balance. The top slot goes to China with which the US has a trade deficit of $349 billion. Japan accounts for $69 billion deficit, coming in at the second spot. And going by Trump’s assessment of Germans in context of running trade deficit, China and Japan should be even bigger headaches for the US economy then.
In fact, according to a Financial Times report, Trump signed an executive order days before Chinese Xi Jinping’s US visit in April 2017 authorizing a study to look into the $500 billion annual trade deficit of the US. The study has a mandate of 90 days to analyze the issue country country-by-country and product-by-product, the report said. Also, Trump tweeted before the meeting that ” it will be a very difficult one in that we can no longer have massive trade deficits and job losses”.
Donald J. TrumpVerified account
The meeting next week with China will be a very difficult one in that we can no longer have massive trade deficits…
3:46 AM – 31 Mar 2017
After Trump-Jinping Summit, the Trump Administration hailed it as a historic meeting with a breakthrough trade deal that would cut the US trade deficit with China as China agreed to open its market for certain US companies and product categories. But experts are not satisfied. According to a Forbes report, “the deal might actually increase America’s bulging trade deficit with China”. To support its point of view the Forbes analysis further says, “China over the last decade has been progressively closing off its market, and this trend is now proceeding faster than ever under current supremo Xi Jinping”.
Trump would often talk about “unfair economic ties” with Japan. He blames Japan of currency manipulation and unfair trade practices and went on to the extent to say Japan a “drag on the US economy’. He made the comment days before his White House inauguration on January 20 that drew sharp criticism from Japan.
Trade deficit was one of the central campaign themes of Donald Trump. He, in fact, has blamed trade deficit for slowing down the US economy. When the GDP data came out in April, he tweeted his displeasure, “The U.S. recorded its slowest economic growth in five years (2016). GDP up only 1.6%. Trade deficits hurt the economy very badly”.
Donald J. TrumpVerified account
The U.S. recorded its slowest economic growth in five years (2016). GDP up only 1.6%. Trade deficits hurt the economy very badly.
4:21 PM – 26 Apr 2017