The U.S. is losing billions of dollars of foreign exchange to Asia as it struggles to contain its worst recession in decades
The dollar’s value has dropped by nearly $60 to a fresh nine-month low on the news that President Donald Trump has ordered a halt to US subsidies for Chinese companies, leaving US companies in a bind.
The fall in the value of the greenback is hurting U.N. and Chinese companies because of a decline in Chinese demand for U.s. products.
U. S. Treasury Secretary Steven Mnuchin, who oversees the trade deal with China, said Thursday that the U. s. has lost $5.8 billion of foreign currency to Asian markets, more than all the countries combined.
But that is more than the $2.6 billion lost to the rest of the world in 2017, according to the Treasury.
The $5 billion loss is nearly the same as the $4 billion loss to all of the other countries combined in 2017.
The US trade deficit with Asia has shrunk to $58.2 billion from $75.6 bn in 2017 because of the U s trade war with China.
“It’s going to have an impact on our ability to raise the money we need to pay the bills we have to pay,” Mnuchin said Thursday, according with ABC News.
The Treasury Department did not provide an estimate of the loss to US businesses.
The Trump administration is looking to raise $1 trillion in foreign currency and sell off U. bn foreign debt by the end of the year, with the goal of getting the country out of a deep economic hole.
The new Treasury Secretary said it is a big challenge to manage this.
Mnuchin told the House of Representatives’ foreign affairs committee that the government is “deeply committed” to the Trans-Pacific Partnership trade deal, which is negotiated by 12 countries.
The pact is being negotiated between 11 countries and the United States.
“We are very committed to the TPP and our plans for trade and our efforts to build a stronger, more prosperous, fairer, more inclusive, safer, more just, more free and more just world,” Mnichinsaid.
The trade deal is worth $8 trillion and will be a major pillar of Trump’s foreign policy.
The president is expected to sign the trade pact into law before he leaves office on Jan. 20.