Tariffs as a weapon? Immigration deal with Mexico may embolden Donald Trump in trade talks with China

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WASHINGTON – President Donald Trump’s success at using the threat of tariffs to get an immigration deal from Mexico will probably embolden him to stand his ground in trade talks with China, White House Acting Chief of Staff Mick Mulvaney predicted Tuesday.

The threat of tariffs is what persuaded Mexico to come to the table and agree to increase security along its southern border with Guatemala, where many Central Americans are crossing into Mexico on their way to the U.S., Mulvaney said at a fiscal summit in Washington.

Trump had threatened 5% tariffs on all Mexican imports unless officials there figured out a way to crack down on the flow of Central American migrants.

But Trump announced Friday he will not go forward with the tariffs after all, saying Mexico has agreed to take new measures to stop the illegal flow of migrants into the United States.

The success of Trump’s tariff strategy “probably emboldens him to take a tougher stance” against China, Mulvaney said.

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The U.S. and China have been negotiating for months to reach a new trade agreement, but those talks have stalled.

Trump already has slapped tariffs on billions of dollars in imports from China and threatened more duties on another $300 billion worth of goods unless Chinese leader Xi Jinping meets with him at the Group of 20 summit later this month in Japan.

In an interview Monday on CNBC, Trump said he expects the meeting to take place and predicted, again, a new trade agreement with China.

“You know why?” he said. “Because of tariffs.”

New U.S. tariffs of 25% on $200 billion in Chinese goods went into effect on May 10, after the two sides were unable to nail down the details of a new trade agreement during talks. Tariff rates jumped to 25% from 10% on a massive range of Chinese goods, including office furniture, handbags and frozen catfish fillets.

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Mulvaney said the trade standoff with China is “hurting them more than it’s hurting us.”