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Putin says US tariffs are designed to hold back China’s rise

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Via CNBC

Russian President Vladimir Putin attends a session of the St. Petersburg International Economic Forum (SPIEF), Russia June 7, 2019.

Maxim Shemetov | Reuters

U.S. trade tariffs on China are aimed at holding back the country’s economic rise, Russian President Vladimir Putin said Thursday.

During his annual phone-in with members of the Russian public, Putin said U.S. tariffs on China, and also sanctions on Russia’s economy for its annexation of Crimea in 2014, were aimed at holding both countries back. He also added that recent restrictions placed on Chinese tech giant Huawei were designed to weaken the world’s second-largest economy.

“What do they want to do? They want to curb the rise of China, the same is happening in the case of Russia and it will continue to happen,” he said during the live TV broadcast, according to a translation.

“So if we are to have a certain place in this world we just need to be strong, particularly in the economy,” he said.

Putin likened tariffs on China to sanctions on Russia, saying both were punitive.

“China has nothing to do with Crimea or the conflict in the southeast of Ukraine — we are accused that we occupied (the) Donbass (region in Ukraine) but that’s complete nonsense, that’s a lie. But what has China got to do with it? But the U.S. slapped tariffs on their goods, you can call it sanctions — tariffs, sanctions, it’s the same way,” he said.

Putin’s comments come as Russia and China appear more united in the face of a common economic rival. The U.S. imposed import tariffs on China at the start of 2018, saying that China’s trade practices were unfair, and the trade conflict has since escalated.

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Talks are ongoing to reach some kind of trade deal and a meeting between President Donald Trump and Chinese President Xi Jinping is taking place next week, though hopes for an immediate deal being signed are low. In the meantime, Trump has faced pressure to take a tougher stance on Russia, particularly in light of its alleged meddling in the 2016 U.S. election.

It is Putin’s 17th annual question-and-answer session with Russian citizens and the “Direct Line” covers a variety of topical domestic issues from health care and jobs to housing and waste collection. This year’s event comes amid rumblings over living standards in Russia.

Putin faced public criticism and protests, and his approval ratings were dented late last year, after he approved long-delayed pension reforms, including gradually raising the retirement age by five years (from 55 to 60 for women from 60 to 65 from men). Protests had led Putin to row back on initial plans to raise the retirement age for women to 63 years.

The call-in also comes amid continuing international sanctions on Russia for its annexation of Crimea in 2014 and role in a pro-Russian uprising in eastern Ukraine in the same period. Russia’s economy is expected to grow only 1.2% in 2019, the World Bank predicted earlier in June.

In its Global Economic Prospects report, the bank said “tighter monetary policy, combined with a value-added tax hike at the beginning of 2019, are also contributing to weaker growth momentum in the remainder of 2019.”

Private investment also remains tepid “due to policy uncertainty and prospects for slowing potential growth over the longer term due to worsening demographic pressures.”

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