- 4 hours ago
Category
đź—ž
NewsTranscript
00:00So you just got back from meeting with a number of trade partners and at the moment global trade
00:05is upended by what's going on in the Strait of Hormuz. Did you have an update to give American
00:09trading partners about the flow of trade through that critical waterway? Well right now I think
00:15the thing to understand is that the United States is generally insulated from a lot of the supply
00:20chain effects when it comes to you know direct commodities and things like that. For a lot of
00:25that we have domestic sourcing, we have sourcing from our partners to the north and south of us
00:29and other places but obviously we're aware that this has an impact in other in other countries
00:35particularly in Asia. We know that their supplies are tight and so we're watching that really closely.
00:40When I was meeting with all of them this was not a particularly high on their agenda of things to
00:45discuss with me because we were meeting for other reasons but we're monitoring the situation given
00:50that the the supplies of commodities coming out of the out of the Gulf can affect our trading partners
00:56along the waves. And it's not just crude it's liquefied petroleum gas which you need especially
01:00in countries like India to cook its fertilizer. Do you have a sense of a timeline? Well you know
01:06first of all any kind of operation you're focused on objectives and you don't want to set artificial
01:10timelines. When I hear from the Secretary of State or the Secretary of Defense they talk about
01:15you know operations in terms of weeks. We hope that's the case. The Trump administration has made a lot of
01:21headway and its objectives in Iran in terms of destroying ballistic missiles, destroying the Navy
01:26and making progress to make sure that they don't obtain a nuclear weapon. You met on the sidelines
01:30with your Chinese counterpart. China buys the lion's share of Iranian crude. We have seen Chinese vessels
01:37given safe passage through the strait. Did this become a focal point of that conversation?
01:42It did not. When I met with my counterpart Minister Wong, the Ministry of Commerce Minister,
01:48this did not come up. We were focused on preparing for the leaders meeting which will occur
01:53in mid-May. We were talking about the WTO itself and the future of it or potentially lack thereof as
01:59the case may be. And so lack thereof? You thinking about getting out? Well I wouldn't say that. I would
02:04just
02:04say that the ability of the World Trade Organization to meet the needs of the moment, addressing structural
02:09imbalances, currency issues, huge export-driven surpluses by other countries. The WTO has never
02:16been able to address those things and it won't be going forward. It can barely address issues on its
02:20current agenda. So potentially you want a revamp of the WTO? Is that what you're calling for? I will
02:26tell you that we have called for reform. The Trump administration has put in many proposals,
02:31concrete proposals about reform, about how to graduate countries to take on more obligations as they
02:37become more developed. We've talked about making sure that countries can adjust their tariff schedules
02:43to account for national core interests. And we put forward a reform plan together with a bunch of
02:49trading partners at a recent meeting in Cameroon. And there was near consensus on this. Countries like
02:54Brazil and Turkey eventually opposed the closing package which is unfortunate. But it's also kind of
02:59exhibit A of how the WTO is unable to address these core challenges. Back to the straight in your
03:04conversation with your Chinese counterpart, the president has been pretty direct to European allies.
03:08If you want the straight to open, you should also help us send vessels, send a minesweeper, send your
03:12navy. If China is the one that's benefiting the most in terms of they're the ones that for years have
03:18been
03:18supporting this brutal regime, should they also not be on the hook to reopen the street? Well, listen,
03:24this is a decision for China and I'll obviously let the president and secretary of state and secretary of defense
03:29decide how they're going to align with other countries in reacting to to the Strait of Hormuz
03:34closing. Again, it affects these other countries much more than it affects us. Other countries have
03:39been working with Iran to figure out arrangements to get out oil, gas, fertilizer and all these other
03:44things. But it is clearly in the interest of the world community to make sure, not only to make sure
03:50that
03:50the strait is open, but to make sure that Iran doesn't get a nuclear weapon, Iran doesn't empower its terror
03:56proxies in the region. The world would be much safer if the world was aligned on taking care of
04:01the Iran issue. As you prepare for this trip, there's a lot of reporting that China, like Russia,
04:06is helping Iran, even when it comes to not just supply chains, but targeting U.S. troops.
04:11Is this going to be on the agenda when the president meets? Is this even potentially a reason why
04:16the trip could maybe get postponed? In past meetings between the presidents, they've always talked
04:22about conflicts and hotspots. In the past, they've talked about Ukraine and Russia. They've talked
04:27about Iran. I assume that they'll talk about these things again. With respect to your question,
04:32is there going to be a delay in the meeting? I haven't heard talk about that, neither internally.
04:37I didn't hear that from my Chinese counterpart when I talked to him last week. When it comes to
04:41the tariffs right now, there's Section 301 tariffs that you're looking into when it comes to China.
04:46We've seen China actually have their own announcement that they're going to investigate U.S.
04:50companies. This tit for tat we might see in the trade between Beijing and Washington,
04:56back to where we're almost what it feels like a year ago. Do you think that's going to hinder
05:01the U.S. from getting back to the 20 percent level they were at before IEPA was struck down?
05:05I don't think so. When you look back to the Busan agreements, the agreements we achieved with the
05:10Chinese last year, we were seeking stability. We were seeking to achieve a level of tariff
05:17application on one side and a flow of rare earth minerals and things from the other side.
05:22Both sides want stability. Both sides want to see continuity. The Chinese know that the United
05:26States is trying to control for our, you know, giant trade deficit we've had with China for a long
05:30time, which went down by 30 percent last year, by the way. So I don't think it's going to...
05:35China's imports to other countries went up, and then those countries are importing to the United
05:41States. Don't you have an issue with trans-shipment at the moment?
05:43So there's always been an issue with trans-shipment, but when you look at our shipments
05:46from third countries outside of China since April, right, since Liberation Day,
05:52that deficit has gone down by 17 percent. So while there may be some trans-shipment,
05:56overall our trade deficit is going down. It's going down with China, it's going down with the rest of
05:59the world. It's going exactly the right production direction. At the same time, wages are going up in
06:04America. Productivity is going up. Do you think you're going to get to the 20 percent level?
06:08Well, I can't prejudge the investigations, right? It's Section 301. We have to go through the legal
06:12process. We have to collect information. It's quite public. It's quite transparent. You know,
06:17we know what the nature of the deal is that we struck with the Chinese. So we will see. All
06:21I know is
06:22that the president for sure is going to keep protecting our economy. He's going to protect our
06:26producers so we can continue to have increased production in the U.S., increased wages here.
06:30If China plays hardball though, not just with their own investigations, but potentially bringing
06:34rare earths back into the foray. I know they have basically till October, there's a deal on the table.
06:40Potentially then, would you look to maybe decrease the tariff level?
06:44Well, you know, from our perspective, we're looking for stability. We're trying to achieve,
06:50we're trying to get the trade deficit reduced. We're trying to increase manufacturing in the United
06:55States, and we're trying to increase real wages. And all of that is happening. So we don't see a
06:59need to change our policy. The Chinese want stability. We want stability. I actually see
07:04a positive agenda with China going forward where we learn to manage our trade with each other,
07:08where we pick the kinds of things we want to be selling to each other, things that are mostly
07:13non-sensitive to avoid some of the national security elements that prove challenging in negotiations.
07:19I see stability with China over the next year.
07:21When it comes to this extension on rare earths, are you going to need one in October?
07:25Or will you think the United States is in a place where we don't need an extension?
07:29Well, we've made a lot of progress. We have a few months, so I think we'll assess that down
07:32the road. You know, we have Project Vault, where we're stockpiling a lot of critical minerals and
07:37rare earths. We have new projects in the United States to mine, process and manufacture rare earths,
07:42including permanent magnets that we need for different motors. We're working with our counterparts and
07:47our trading partners, Australia, the EU, Japan, Mexico, to find projects we can do together to
07:52increase supply chain security.
07:54How much will rare earths be on the table of this discussion with the President and Xi Jinping in May?
07:58So when we met in Paris with our Chinese counterparts a couple of weeks ago, we talked about rare earths.
08:04The process with the Chinese is working fairly well. There are a few things here and there where
08:08we highlighted that we didn't feel like we were getting rare earths in a timely fashion. And we
08:13highlighted that to our partners. They took note of that and have it under consideration. So the
08:18presidents will talk about it if they need to. Our hope and expectation is that we're able to manage
08:22a lot of it between now and then at the staff level. Do you think you're going to have to
08:26meet
08:26your counterparts again before the big leader meeting in Beijing? I don't think we're going
08:31to need to do that. Particularly when we were in Paris, we reached general agreement on the
08:36types of outcomes we want for the leaders meeting. And right now, our deputies and our staff
08:40are in regular communication to try to land all those outcomes. Can you give us any sense of what
08:47the main deliverables are going to be in Beijing? I think that one of them,
08:50uh, and people, there's been a little bit of coverage on this. We've been talking about
08:54a board of trade, a U S China board of trade, which really will be a mechanism to help manage
08:59trade over the past 10 years or so as the United States has tried to eliminate its trade deficit
09:04with China, figure out its export control situation. If we can formalize the mechanism a little bit to
09:11make sure that we are, we can agree on things we are selling to each other for the U S
09:15we want to be
09:16selling, uh, Boeing's, uh, we want to be selling medical devices, pharmaceuticals, ag products,
09:21things like that. You know, the Chinese want to be selling things to us and we're willing to buy
09:25things like, you know, low tech consumer goods and things like that, certain commodities that maybe
09:30the Chinese have that we don't. And so coming, you know, establishing that type of mechanism at the
09:35leaders meeting and then going through a process of figuring out how to optimize trade with each other,
09:39that's going to be a big deliverable.
Comments