WASHINGTON — U.S. President Donald Trump rolled out another $16 billion in aid for farmers hurt by his trade policies, and financial markets shook Thursday on the growing realization that the U.S. and China are far from settling a bitter, year-long trade dispute.
U.S. Agriculture Secretary Sonny Perdue said that the first of three payments is likely to be made in July or August and suggested that the U.S. and China were unlikely to have settled their differences by then.
“The package we’re announcing today ensures that farmers do not bear the brunt of unfair retaliatory tariffs imposed by China and other trading partners,” Perdue said.
The latest bailout comes atop $11 billion in aid Trump provided farmers last year.
“We will ensure our farmers get the relief they need and very, very quickly,” Trump said.
Seeking to reduce America’s trade deficit with the rest of the world and with China in particular, Trump has imposed import taxes on foreign steel, aluminum, solar panels and dishwashers and on thousands of Chinese products.
U.S trading partners have lashed back with retaliatory tariffs of their own, focusing on U.S. agricultural products in a direct shot at the American heartland, where support for Trump runs high.
William Reinsch, a trade analyst at the Center for Strategic and International Studies and a former U.S. trade official, called the administration’s aid package for farmers “a fairly overt political ploy.”
“It’s not economics,” Reinsch said. Trump wants win the farm states again in the 2020 election, “and he’s got members of Congress beating up on him” to resolve the trade conflicts.
Financial markets buckled Thursday on heightened tensions between the U.S. and China. The Dow Jones industrial average fell 286 points, or 1 per cent, to 25,490. It had been down 448 points earlier in the day.
U.S. crude plunged 6 per cent on trade standoff could knock the global economy out of kilter and kill demand for energy.
Talks between the world’s two biggest economies broke off earlier this month with no resolution to a dispute over Beijing’s aggressive efforts to challenge American technological dominance. The U.S. charges that China is stealing technology, unfairly subsidizing its own companies and forcing U.S. companies to hand over trade secrets if they want access to the Chinese market.