Trade War With China Might Hit Coal Country

REUTERS/Jose Luis Saavedra

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Jason Hopkins Immigration and politics reporter
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President Donald Trump’s escalating trade war with China might harm a constituency he highly prioritizes: coal country.

Trump has placed great emphasis on the struggles of the U.S. coal industry since entering the political scene. He promised to breathe life back into traditional energy, a sector that had been hit hard with tougher government regulations, during the 2016 campaign. Upon entering office, Trump rolled back a litany of rules that had been enacted during the Obama era. The president took an even greater step by ordering Secretary of Energy Rick Perry to use emergency authority to stop the rapid closures of coal plants across the country.

Trump is fighting an entirely separate battle when it comes to U.S. trade. Arguing that the U.S. has a trade imbalance with China that needs to be corrected, the White House on June 15 announced a 25-percent tariff on $50 billion worth of Chinese goods. The president furthered escalations on Monday by threatening to slap an additional 10-percent tariff of $200 billion worth of Chinese imports.

Chinese officials, who have accused U.S. of “blackmail,” are vowing retaliatory measures. The world’s most populous country has threatened to tariff $50 billion in U.S. products in response.

“We don’t want a trade war, yet we are not afraid of a trade war,” said Chinese Foreign Ministry spokesman Geng Shuang on Monday.

Notably, the Chinese appear to be targeting the rural communities that serve as a major faction of Trump’s base of support. Coal, natural gas, oil and farm products are included in the list of U.S. industries that would be targeted by President Xi Jinping’s government. If China moves forward with its own tariffs, it could spell trouble American coal companies, many of which depend on exporting their products as demand at home continues to wane.

China imported a total of 3.2 million tons of U.S. coal in 2017. Leaders in the country had expressed interest in May in purchasing more coal in order to narrow the U.S.-China trade deficit. However, the Chinese government has yet to give a date on when it would enact such tariffs, leaving coal leaders attentive, but not yet worried. (RELATED: China Says Trump Has Started A Trade War, Warns It Will Fight Back)

“We’re obviously watching it closely,” National Mining Association spokeswoman Ashley Burke said in a statement to The Washington Post. “So anything that would chip away at the appetite for U.S. coal abroad would be of concern. At the same time, given that just two weeks ago we were being asked about China’s rumored plans to increase coal imports from the U.S., we don’t want to get ahead of developments before anything occurs.”

If Chinese tariffs are initiated, it might not have a great impact on American coal producers. The 3.2 million tons of coal the country imported in 2017 only made up 3 percent of all American coal exports. Experts predict the U.S. would likely be able to locate other buyers to make up for any lost sales.

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