Singapore leader: US usa rubber braceletsshould look at self on trade deficit

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US President Donald Trump meets with Singapore’s Prime Minister Lee Hsien Loong at the Istana in Singapore on Monday. [Photo/Agencies]

The reason why the United States is running an overall trade deficit is not mainly because of other nations" restrictions, Singapore Prime Minister Lee Hsien Loong said on Monday.

"If you are spending more than you are producing, that means you will have a trade deficit; if you"re spending less than you"re producing, that means you will save money or run a trade surplus," Lee said in an interview with CNN"s Christiane Amanpour.

US President Donald Trump, who is visiting Lee"s country to attend a historic summit with the Democratic People"s Republic of Korea"s top leader Kim Jong-un on Tuesday, campaigned on a promise to bring down the US trade deficit, which he said last week stood at $817 billion.

The Trump administration has focused its criticism on many US trade partners, including China and the Americans" key allies.

Most recently, it has renewed a threat to hike tariffs on $50 billion of Chinese goods and slapped a 25 percent tariff on steel imports and 10 percent tariff on aluminum imports from the EU, Canada and Mexico.

"Fair trade is now to be called Fool Trade if it is not Reciprocal," Trump tweeted on Monday after abruptly withdrawing support for a joint declaration on free trade signed at the Group of Seven summit over the weekend in Canada.

In the interview with CNN, the Singaporean leader countered Trump"s arguments about the US trade deficit with China. He said Trump"s starting point is that he has a big trade deficit with the Chinese and that"s a bad thing, and he wants to fix the issue by having China buy more from America.

"You have to look at it a more fundamental level. Why is America running an overall imbalance? It"s not just - and it"s not mainly - because of trade restrictions," Lee said.

Lee said China"s economy has grown exponentially compared with 2001 when it joined the World Trade Organization. When it comes to trade issues, it is much better to talk in a multilateral framework, he said, adding, "there"s a WTO, there is a basis for many countries to come together to work in accordance with international rules".

The rules give space for all countries, big and small, to operate under the same framework, he said.

On Sunday during the Shanghai Cooperation Organization Summit in Qingdao, a coastal city in Shandong province, President Xi Jinping extolled free trade and criticized "selfish, short-sighted" policies.

"We should reject selfish, short-sighted, narrow and closed-off policies," Xi said. "We must maintain the rules of the World Trade Organization, support the multilateral trade system and build an open global economy."

On Monday, leaders of the International Monetary Fund, WTO and other agencies gave their support to multilateral trade and warned that US protectionism could cause global economic damage.

At a meeting in Berlin hosted by Chancellor Angela Merkel, the German leader and top officials from IMF, WTO and some other agencies said in a joint statement that the "increasing protectionist tendencies provide us with a clear incentive and opportunity to express our strong support for the multilateral trading system".

IMF chief Christine Lagarde said at the meeting that the global economy was in good shape. She said "the sun is still shining" but warned that it"s "getting darker by the day".

"The biggest and darkest cloud that we see is the deterioration in confidence that is prompted by (an) attempt to challenge the way in which trade has been conducted, in which relationships have been handled and in which multilateral organizations have been operating," Lagarde said.

WTO Director-General Roberto Azevedo told the Berlin news conference: "We must ... stop this escalation of tensions.," according to a Reuters report.

"They have been complaining about the system, they say that they want to improve the system, but we would expect a more constructive approach on their part," Reuters quoted Azevedo as saying.

The Associated Press contributed to this story.

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