Trump’s policies threaten to spark a global trade war

These policies aim to correct Trade balance In favor of the United States, it raises widespread concern about its implications for… American economy itself, and even the entire global trading system.

Through what is known as “Fee war Tariffs,” Trump seeks to target China And Canada And MexicoIn an attempt to restructure his country’s trade relations.

According to analysts, this protectionist approach would unleash a wave of retaliatory responses, threatening economic stability and confusing the economy. Global marketscausing escalation of tensions between the largest economic powers.

Trade war

According to a report by the British newspaper The Guardian, according to experts commerce And the economy, it created a threat to the US President-elect, Donald TrumpSuppose Customs duties expensive on Imported goods To the United States, the stage for a bitter global trade war, with consumers warned And companies It is necessary to prepare for high costs.

Last Monday evening, Trump announced his intention to impose tariffs on Canada, Mexico, and China on all of their exports to the United States. So that these countries work to limit immigration and the flow of drugs into the country, as he described it.

While officials in the three countries were quick to respond, former Director of the World Trade Organization, Keith Rockwell, predicted that Trump’s move would spark a trade war.

For its part, the China It indicated that both sides would lose from escalation Economic tensions. “No one will win a trade war or a tariff war,” Liu Bingyu, a spokesman for the Chinese embassy in Washington, wrote on X.

Hours after Trump’s remarks, economists at ING published research estimating that his broader campaign proposals on trade — including a global tariff of 10 to 20 percent on all goods imported from abroad, and a 60 percent tariff — On all goods from China – it could cost each American consumer up to $2,400 per year.

“This is a potential increase in consumer costs,” said James Knightley of ING And inflation “It could have wide-ranging economic impacts, especially in an economy where consumer spending represents 70 percent of total activity.”

But according to the Guardian report:

• It is unclear whether Trump, who has called “tariffs” “the most beautiful word in the dictionary,” will implement this plan; This is because tariffs (taxes paid by companies that import foreign goods) are unpopular among voters, even among Trump voters.
• A Harris poll conducted for the newspaper showed that 69 percent of people believe prices will increase accordingly.

A new era of trade protectionism

The former head of China’s department said International Monetary Fund,Easwar Prasad:

• “Trump’s statements clearly threaten the dawn of a new era of US trade protectionism that will sweep away many of the US’s trading partners.”
• “These tariffs will have a devastating impact on the United States as well as international trade, as countries around the world compete to cushion the blow of US tariffs on their economies and try to find ways to evade the tariffs.”

During the campaign, Trump and his allies claimed that such measures would help boost… American economy And “Make America Great Again.” But many economists took a different view, warning that imposing sweeping tariffs would raise the prices of goods for American consumers and risk prompting other countries to take retaliatory measures, harming American companies that export goods to the world.

But in his remarks Tuesday, Trump did not focus on the economic benefits he claimed the tariffs would bring. He even blamed Mexico and Canada for the “ridiculous open borders” that he claimed caused the migration crisis, and China for the “massive amounts of drugs, especially fentanyl” arriving in the United States — and vowed to impose tariffs on those countries until his concerns were addressed.

Mitigating risks

For his part, the economic expert and chief economist at ACY, Dr. Nidal Al-Shaar, tells the “Eqtisad Sky News Arabia” website that all the objective factors that we are witnessing today indicate a high possibility of the outbreak of an international trade war that may develop into a political conflict. However, there are also internal and external indicators in the countries concerned that indicate the possibility of reaching solutions.

He continues: “The conflict existing between… Russia And Ukraine It is considered an essential factor in the current situation. There is a possibility that it will arise US President-elect Donald Trump, with certain efforts to mediate between Putin and Ukraine to find a solution to this conflict, given its significant impact on… Global trade And oil prices and the issue of sanctions… As for the conflict between Taiwan and China, the situation seems complicated, but there are international efforts to reduce the severity of this conflict.”

Al-Shaar adds: It is very important to note that the protectionist policies that Trump adopts towards… European Union China, as well as Canada And Mexico It raises concerns, however, that “the relationship between the United States, Canada, and Mexico is very close and therefore unlikely to develop into a hostile confrontation.”

While regarding the relationship with China, he explains that “this relationship is more complex”:

• But we expected balanced reactions from China towards the US sanctions, as we noted that it did not take extreme retaliatory steps.
• China is always seeking solutions, which is evident in the shift of its trade to countries such as Vietnam, Korea, the Philippines, and India.
• At the same time, China’s response to the American threats was rational, as it stressed that the increase in customs tariffs would not be in the interest of any country, which opens the way for possible negotiations between the two countries.
• The potential impact on the European Union if the United States imposes sanctions on China must also be taken into account; Beijing may seek to expand its trade relations in European markets, which could lead to intense competition with the European Union, which may not be in a position to withstand such competition.

He concludes his speech by saying: Trump’s character is that he is a deal-maker who follows the method of threats and negotiation, as he begins with high demands and then negotiates to reach compromises. Therefore, it is likely that not all of the threats raised will be implemented, but rather things will move towards negotiations to reach solutions that satisfy all parties in stages.

The heart of global relations

According to a New York Times report:

• Trump’s threats may have been intended to silence investors and economists who have recently wondered whether the president-elect would go ahead with the large tariffs he promised during his campaign.
• In the run-up to the election, Trump pledged to impose 60 percent tariffs on goods from China and a tax of at least 10 percent on all other imports. Such a move could spark a global trade war, slowing economies around the world.
• Whether Trump’s threats ultimately demonstrate his prowess as a dealmaker or sow chaos, they confirm that the president-elect is eager to upend global relations in an attempt to secure points for the United States.
• This includes preparing to drop the trade agreements he himself worked to establish with Mexico, Canada and China during his first term after using painful tariffs to force concessions.
• One such deal was the United States-Mexico-Canada Agreement. This trade agreement replaced the previous agreement, the thirty-year-old North American Free Trade Agreement, which Trump described as “the worst trade agreement ever.”
• Under the United States-Mexico-Canada Agreement, goods that meet certain requirements can move across the continent without being subject to tariffs. Imposing customs duties of 25 percent on all Mexican and Canadian products constitutes a clear violation of this agreement, and may raise questions about the future of the agreement itself.

Challenges

In exclusive statements to the “Eqtisad Sky News Arabia” website, Professor of International Economics, Dr. Ali Al-Idrissi, highlights the challenges facing global economic relations at the present time.

• Trade war between the United States and China: Tensions remain, as the two countries impose tariffs on many goods, increasing competition, especially in areas Technology.
• Protectionist policies: the tendency to enhance domestic production by imposing restrictions on free trade, leading to mutual reactions and effects.
• Geopolitical crises: Conflicts such as the war in Ukraine negatively impact trade and energy prices, increasing economic divisions.
• Global economic fluctuations: Slowing growth and increasing inflation prompt countries to take measures to protect their markets, which may contribute to escalating trade disputes.

As for the repercussions, they are summarized in Al-Idrisi’s assessment as follows:

• Declining growth rates: This pattern of “trade wars” leads to a slowdown in the global economy as a result of a decline in trade and investment.
• High costs for consumers: The expansion of customs tariffs raises the prices of goods, affecting the purchasing power of consumers.
• Supply chain disruptions: Trade restrictions may hinder access to raw materials and finished products.

The professor of international economics stresses the need to strengthen the role of international organizations such as: World Trade Organization In resolving disputes and coordinating policies, as well as the importance of updating trade rules to suit modern developments.