Paris: With his inclination in rates, the president of the United States, Donald Trump, is increasing the spectrum of a rare intensity commercial war, threatening the nations associated with sanctions that run the risk of interrupting global trade.
While the American leader has delayed the implementation of some of his threats, he announced on Wednesday that he was placing additional tariffs at 25 percent in cars and car parts that enter the United States.
He has promised an additional round on April 2, an appointment that has called “day of liberation.”
Accelerate
“A country seems weak if it does not impose retaliation measures” in the face of rates increases, said Aurelien Saussay, professor at the London School of Economics.
The promises of retaliation have been quick to arrive and implemented directly.
After the opening of Trump Salvos, China replied slapping tariffs on US agricultural products.
The European Union has promised to respond in mid -April to the 25 percent tariffs that Trump could impose on the block on April 2. Beyond the retaliation measures that could multiply, the commercial war could also cause overproduction in producing countries.
“This is particularly the fear of Europeans, who could not only export less to the United States, but also see China try to flood their market to compensate for their decline in exports to the United States,” said Eric Dor, director of Economic Studies of the IESEG School of Administration of France.
“Europe would respond to that with an increase in tariffs to protect its industry.”
Fall in growth
“The imposition of new bilateral rates and the associated worsening of political and geopolitical uncertainties will exert a damping effect (in commerce),” the OECD predicted in a report of mid -March that reviewed the global growth forecast down.
Mechanically, the elevation of tariff barriers leads to a decrease in exports and, therefore, a decrease in activity in producing nations.
“The markets are disappearing, which threatens jobs and growth,” said Saussay del LSE.
One of the countries most threatened by the commercial war is Mexico, a key trade partner of the United States and that is expected to enter the recession this year, according to the OECD.
Japan, where around one in 10 jobs is linked to the automotive sector, is also very exposed to the effects of tariffs. In “emerging” countries, such as Brazil, whose economies depend a lot on raw materials, chain reaction that emanates from a commercial war is also observed closely.
“If strict policy in the United States is very aggressive in general and we see that global growth slows down significantly, so much that the prices of basic products receive a blow, then it is when we are going to see a negative impact,” said Benito Berber, a chief economist of Natixis.
The increase in customs barriers that Trump’s policies could generate whether to carry out their threats would not have precedents in almost a century and sink global commercial players in unknown territory.
Trump actually faces market pressure, as well as car manufacturers and could pay a high political price in the form of important social or inflationary consequences in the home caused by their decisions.
Posted in Dawn, March 29, 2025
