What Peter Navarro Means for US-China
The United States will be more aggressive on China
First, plan for the Trump administration to restrict the imports of steel and aluminum from China. In the past, American manufacturers have relied on anti-dumping (AD) and countervailing duties (CVD) litigation to seek tariffs on dumped and subsidized imports. Through appointments and policy directives at the Commerce Department and the US International Trade Commission (ITC), a Trump administration could encourage more litigation to address unfairly priced imports. The President also has broad power to grant “safeguard” relief in situations where the ITC finds that imports have been a substantial cause of serious injury to a domestic industry.
It is important to note however, there have been no major cases seeking safeguard relief since a 2001 case on steel. In large part, because domestic producers doubted past President’s willingness to grant relief and/or previous governments have not encouraged litigation and have instead relied on good faith negotiations to smooth out trade irritants. However, planning for new cases brought by business and/or the new government directly would be wise under a Trump administration.
Second, plan for the Trump administration to hit China with the currency manipulation label. Labeling a nation a currency manipulator is more symbolic, but it provides an easy bumper sticker political win that easily understood by the voters that sent Trump to the White House. Once a nation receives this label, the US Treasury Secretary will need to "take action to initiate negotiations … for the purpose of ensuring that such countries regularly and promptly adjust the rate of exchange."
So more consultation and meetings must take place between Washington and Beijing, but Beijing will have to respond in some fashion to the move - be it delayed licenses, deferred contracts, less market access, etc. Many in the US-China business and diplomatic community believe that a move by the US to label China a currency manipulator would launch a slow and negative tit-for-tat trade relation environment between the two nations. It important to note China was last labeled a currency manipulator in 1994.
Third, plan for the new Trump administration to make more use of intelligence, national security, foreign policy, and trade staff and ideology to engage China as mean to lessen intellectual property theft and the import of products/components/parts used by America’s military. Trump will likely increase enforcement actions to ensure that China is playing by the existing WTO rules as well as seek greater protection of US intellectual property and technology used in China.
Trump will make trade between the US and China not just about simple economics, but more about complex and thorny issues of “America First,” national security, intellectual property protection, and military responsibilities.
From my memo - Trade and the New Trump Administration https://www.caracal.global/buzz/2016/11/25/trade-and-the-new-trump-administration-1