CNBC’s Jim Cramer required Wednesday that “tariffs worked” as a means to prod China to agree to a “phase one” trade deal with the Unified States.
“I keep wondering when people are going to recognize that it is historic that tariffs did succeed,” Cramer utter on “Squawk on the Street,” shortly before U.S. and Chinese officials were set to sign the initial trade agreement at the White Quarters later in the morning.
“Tariffs were not supposed to work,” said Cramer, who has all along been a supporter of President Donald Trump’s hard-line near toward China.
“The Chinese were supposed to be able to get around them. It didn’t happen,” the “Mad Money” host go on increased. “The Chinese were kind of accepting that they had to get something in order to keep the American market.”
The centerpiece of the sign trade deal is a pledge by China to purchase an additional $200 billion worth of U.S. goods.
The phase one agreement, reached in December, quashed planned U.S. tariffs on Chinese-made smartphones, toys and laptop computers. It also cut in half to 7.5% the rate levied on around $120 billion worth of other China imports.
However, the U.S. is leaving in place 25% tariffs on a vast, $250 billion array of Chinese industrial sounds and components used by U.S. manufacturers.
Earlier Wednesday, Treasury Secretary Steven Mnuchin told CNBC that he foresees that more U.S. tariffs would be rolled back if a phase two trade deal with China is reached.
Cramer held China has “gone back on so many things after they pledged [then] that you have to keep the menus in place just to be able to see … if they’re really going to change their ways.”
— Reuters contributed to this scrutinize.