Global Economies Intensify Responses to Trump’s Tariff Strategy: What It Means for Future Trade Tensions

Tariff Photo:VCG

Major economies are gearing up to deal with potential tariffs that US President Donald Trump is expected to announce soon. Experts warn this move could heighten trade tensions globally.

European businesses are especially worried about the financial impact of a trade fight with the US. Many executives are concerned that the unpredictability of Trump’s trade policies is influencing their investment decisions.

Recently, Trump paused new tariffs on Canada and Mexico but is still targeting the European Union. This uncertainty leaves companies guessing how severe the new tariffs could be.

Trump plans to introduce tariffs that could affect multiple countries next week. This approach aims to reshape global trade in favor of the US, according to reports.

Li Yong, a senior researcher at the China Association of International Trade, described Trump’s strategy as isolating the US economy from the rest of the world under the “America First” ideology.

Global Reactions

Trump’s potential tariffs have caused concern among major trading partners. Canada is looking to strengthen ties with the EU and maintain global trade rules, as trade minister Mary Ng mentioned that Canada could take action through the World Trade Organization if tariffs are applied.

Vietnam is also preparing for possible trade disruption due to a prospective trade war, with Prime Minister Pham Minh Chinh emphasizing that measures should be put in place to protect the country’s economy.

Australia, which relies heavily on trade, is cautious about the effects of US tariffs. The chief executive of a mining association warned that a trade war could hurt Australia more than it could help.

In response to US tariffs on Chinese imports, China has introduced its own tariffs on various American goods. This back-and-forth increases tension in international trade.

Zhou Mi, a researcher at the Chinese Academy of International Trade, noted that Trump’s method for setting tariffs undermines global practices. Rather than negotiating through international platforms, the US is now negotiating on a case-by-case basis, which could lead to higher tariffs overall and increased trade costs.

This approach will likely complicate global trade governance and heighten tensions further, according to experts.

Impact on the US Economy

The repercussions of Trump’s tariff strategy are already visible in the US economy. Consumer confidence has dropped, driven by fears of increased inflation linked to tariffs. Recent surveys indicate a decline in sentiment, trailing behind forecasts.

Li Yong pointed out that tariffs could damage the US economy. While intended to improve trade terms, they might end up increasing costs for businesses and consumers alike. Tariffs usually lead to a higher cost of living and lost jobs in affected sectors, shifting the US further from efficient global trade.

Furthermore, enhancing multilateral cooperation and adhering to rules-based trading systems is vital for other nations, as suggested by experts. While states respond to unilateral measures, countries should work together to stabilize international trade and support economic growth.

China’s Ministry of Commerce criticized Trump’s tariff plans as unilateral trade protectionism, stating it disrupts global trading systems and increases tensions. They express readiness to advocate for free trade and collaborate with other nations to confront these challenges.

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