President Trump has always been upfront about his trade policy. The United States has a very real and very large export deficit with China. The deficit is so bad that it is believed to be taking income and jobs away from key industries.

Trump’s administration took a strong stance earlier this year when it imposed tariffs on Steel and Aluminum from China and other trade partners. While there have been disputes with the E.U., Canada, and Mexico, the trade disputes with China have been the most significant.

As Beijing and Washington are yet to reach any bilateral agreement on trade, the China exports economy is slowing. Tariffs throughout the year and the threat of more could send China’s export growth into negative territory before the end of 2018.

Will Weakened Chinese Export Hurt American Consumers?

The trade imbalance was not created by China alone. Some see China as exploiting the United States. Many economists simply see it as a condition driven by the free market. Consumers demand affordable products, and corporations demand high profits. China manufacturing allows for this.

By making Chinese exports more expensive through tariffs, the White House has the potential to incentivize U.S. production. However, even with higher tariffs, many of the largest companies will still manufacture in China.

Ultimately, tariffs may not only slow the Chinese export economy, but could lead to higher prices for consumers in the United States.

Last week, Apple sent a letter to the White House warning that continued tariffs would lead to higher prices on Apple devices. Trump’s response was to send a Tweet imploring the company to shift manufacturing to the U.S.

From his personal account, the president told followers “Apple prices may increase because of the massive Tariffs we may be imposing on China – but there is an easy solution where there would be ZERO tax, and indeed a tax incentive. Make your products in the United States instead of China. Start building new plants now. Exciting! #MAGA”

Cisco, HP Enterprise, Juniper Networks and Dell recently petitioned the U.S. Trade Representative to exclude them from any upcoming tariffs. The companies argued that new China tariffs would make their products more expensive, and limit infrastructure development.

A Difficult Balancing Act

China’s weakening exports might seem like a win for the American people. Unfortunately, things are much more complicated. Continued pressure from the White House will only be successful if it results in a new trade agreement that benefits domestic interests.

Whether China is willing to compromise for U.S. demands is yet to be seen.