Search Results for: protectionism

German trade statistics are sagging. Most commentators attribute this phenomenon to the global business cycle. More likely, today’s figures are the outcome of earlier decisions made by German companies to move resources outside of Europe, and they are now developing their products elsewhere.

For the global economy, the road ahead is unusually clear – it is headed for a gentle slowdown. But that is no reason for complacency. The next wave of trouble is already visible in the developing countries, which are highly vulnerable to rising interest rates. The EU could do much to prevent the economic slowdown if it cared to.

President Donald Trump declared on October 1 that the new trade deal with Canada and Mexico signifies the return of the U.S. as a “manufacturing powerhouse,” which has indeed changed dramatically since 1992. But the complex and varied factors that have reshaped factory production in the U.S. cannot be summarily reversed.

The WTO is a relatively cheap international organization, but it has achieved little since its creation in 1995. Reforms could make the WTO more useful, especially if they turned it into a body that collects fines from those who violate simple rules – with no exceptions.

A growing middle class, increasing continental integration and huge economic potential all provide reason to be optimistic about the future of Africa’s aviation sector. Yet many governments still see the industry as a cash cow or point of national pride.

It is unusual when CEOs purport to define their companies’ overarching objectives. Things become even more curious when top managers team up with a bureaucracy to call for the imposition of tighter environmental standards on business.

Africa in 2018 was marked by important advances on the economic front, with the agreement to create a Continental Free Trade Area (CFTA). While trade liberalization has the potential to be transformative for Africa, disparate stages of development, protectionist impulses, and political tensions may prevent meaningful advances.

From trade protectionism to government overspending, bad economic ideas are weakening the world’s stability, while increasingly confrontational policies are adopted by global and regional powers.

Brexit talks were supposed to be concluded at the EU summit on October 17. But the deadline passed with no breakthrough. With the clock to a “hard Brexit” ticking down, this could be the salutary shock needed to reach a compromise — or point to a future in which encourages a drift toward protectionism.

The flip side of the Trump administration’s drive to reduce the U.S. foreign trade deficit is that it will leave the rest of the world with fewer dollars to finance its budget deficit. President Trump could cut spending drastically or persuade the Federal Reserve to buy more bonds, but neither seems likely.

The government of India has implemented a protectionist policy on trade, taking measures to boost domestic manufacturing. Yet exports have failed to increase, in part because of red tape and poor logistics.

We are probably coming to the end of a global economic recovery. But with interest rates still hovering around zero, central banks will have no ammunition to fight a recession. Meanwhile, debt is high and more trade barriers are going up. The underlying causes in imbalances of global economy must be addressed.

Over the past two years, protectionism has dominated U.S. trade policy decisions regarding the Asia-Pacific region. However, there are signs that the administration could soften its stance and return to more pro-free trade policies. If it does, that could lay the groundwork for a return to bigger economic engagement in the region.

With the RCEP, Asian and Pacific countries have created the largest and most powerful trade zone in the world. To prioritize economic growth, the member states have put aside political issues. This could serve as an example for Europe.

After a surprisingly good 2017, world trade should do even better this year. But that doesn’t mean that Europe and the United States can afford to be passive. China’s Belt and Road Initiative, which will turn most of Asia into a privileged trade zone, demands a choice – either join the initiative or promote free trade outside it.

Popularity for free trade is decreasing. The WTO has failed to rein in China’s unfair economic practices since 2001, so there is no enforcement of international trade rules. This could be fatal for post-Covid recovery.

Instead of pushing for more free trade, some members of Mercosur are using it to protect their own industries. The rift may spell the end of the customs union.

Even before the most recent disagreement, the U.S. had already begun drawing attention to a new question: whether China had been engaging in protectionism by manipulating its currency. The argument reveals confused ideas about what the U.S. wants: a dominant role for the dollar or an renminbi to please American producers.

Although U.S. President Trump maintains that he believes in free trade, his policy tool remains protectionism. Europe could do more to change this. For example, engage in aggressive free trade or seek bilateral deals. President Trump would be left with few justifications for trade barriers, and Brussels would acquire prominence on the world stage.

The most effective course for the European Union to achieve “great power” status is to extend the continent’s geo-economic weight. The EU was never meant to be a major foreign policy player, and remains an essentially civilian organization.

Russia’s war in Ukraine and the rise of China signal an ideological challenge to the Western order, of the kind thought buried with the Soviet Union.

Global value chains have been shrinking for a decade; the pandemic has only accelerated the process. Western countries are now racing to reshore parts of their strategic manufacturing and make supply chains more resilient. China, meanwhile, continues its quest for dominance.

In theory, the Eurasian Economic Union should be an important economic influence globally. Yet it has struggled to find relevance, not least because it has not managed to build true economic integration. Can it overcome the hurdles?

Germany and France want to lead the European Union, but their leaders, Chancellor Angela Merkel and President Emmanuel Macron, have adopted policies that endanger the bloc. Calls for greater centralization will alienate other member states, while hypocritical criticism of the U.S. and Russia will leave the Union isolated.

Tensions are rising in relations between the U.S. and China, especially after the recent APEC summit. However, the heightened rhetoric used there could give both countries a chance to climb down and come to a deal. Presidents Donald Trump and Xi Jinping will have a perfect opportunity to do so during the G20 summit in Buenos Aires.

The transatlantic relationship can be described as a family matter – with the United States as the mostly benevolent patriarch and Europe as the dependent relatives. Relations had been cooling for at least a decade, but this process is being expedited by the presidency of Donald Trump.

Political interventions rather than markets are causing economic crises in the world. In 2007-2008, politically inspired intervention in the housing market in the United States caused an international financial crisis of epic proportions.

United States President Donald Trump insists that trade wars are “good” and “easy to win,” but history tells otherwise. His plan to slap tariffs on steel and aluminum imports will hurt U.S. producers and will likely cost far more jobs than they protect.

In the aftermath of the Chinese Communist Party’s harsh crackdown on Hong Kong’s independence, many observers believe Taiwan will now face increased pressure from Beijing to fall in line with the political and economic goals of mainland China.

The Covid-19 crisis has not convinced companies that globalization is a bad move. In fact, firms have learned they need to broaden their supply chains and diversify their providers. Governments, however, will use the situation to push nationalization and subsidies.

For most of the 20th century, Japan and Australia had little reason to develop a relationship. However, China’s rise as a regional hegemon has the potential to bring the two countries closer – for example through Japan’s involvement with the Five Eyes intelligence alliance.

The U.S. secretary of state calls the task of finding more creative and assertive ways of containing China the “mission of our time” for the Western world. The challenge is not going to be easy, as the Chinese Communist Party plays its considerable strengths well.

Independence movements are on the rise in Europe. At the heart of this phenomenon is an ever-globalizing world, bringing with it inflows of foreigners and an outflow of traditional industries. Most of these movements have set aside violent measures in recent years, but there is no guarantee that will continue.

While Covid-19 has hamstrung global trade and delivered a brutal blow to several crucial industries, it has also accelerated change and created opportunities that could reshape the future of shipping. China has a big advantage in this post-pandemic geopolitical landscape.

In 2018, Germany’s growth dipped. It is likely to continue sputtering in 2019 and beyond. Too many European companies have become exceedingly dependent on the German economy, and few seem capable of restructuring their production.

Economies have not come roaring back after the Covid-19 crisis due to complicated problems in labor markets. In the U.S., people’s decision not to come back to work is putting pressure on wages. In the EU, governments have to spur growth to solve financial imbalances.

Several large global technology firms have pumped billions of dollars of investments into India’s digital economy sector. The development reflects a trend toward “super apps” being created, helped along by favorable government policies.

EU leaders heaved a sigh of relief after the 2019 European Parliament elections when the much-feared populist wave failed to rock the boat. Yet at most, they have gained a little time. Judging by the tone of the informal summit held in Sibiu, Romania, the EU’s new leadership will favor old narratives over new strategies.

Company earnings are a powerful driver of financial markets. Recently, however, they have been sending contradictory signals. One reason could be the expansionary credit policies of the past decade, which have distorted balance sheets and weakened competition.

President Trump worries that the Federal Reserve is raising interest rates too quickly. In fact, the Fed has engaged in moderate tightening so far. By mid-2019, it is likely to end the cycle and hold rates steady. At that point, Trump will not be able to blame the Fed for any fiscal trouble and will have to implement reforms to spur growth.

A dozen or more global giants have emerged in the online data business, but none in the European Union. That is not for lack of trying. The EU has issued voluminous regulations on data protection and dangled investment incentives for digital entrepreneurs, this outpouring of directives and money has done far more harm than good.

After decades of integration and expansion, the limitations of global governance have been laid bare.

The relationship with the U.S. is a crucial part of foreign policy of India. With the election of Donald Trump as president, New Delhi was unsure what to expect. So far, it has leveraged its strategic importance and the leaders’ friendship to its benefit. The question now is what changes the 2020 election could bring.

The rise of China and changes in the U.S. policy have presented huge challenges for Europe and India. Their interests align with issues such as international trade and climate change. In the face of Brexit, India seeks partnership with other EU countries.

The rising labor costs and low productivity growth in China may lead to a decline in consumer confidence and poor performance of the economy.

Reelected President Emmanuel Macron favors reducing the European Union’s dependence on nations outside the bloc while promoting French national interests from within.

As seen from the U.S., Germany is consumed by internal political strife and incapable of creating valuable relations. So, for the next few years, Washington intends to manage bilateral relations on a transactional basis. At the same time, President Trump has reemphasized the U.S.-UK partnership and put more stock on ties with Central Europe.

By imposing economic sanctions on South Korea, Japan establishes a dangerous precedent. At times when countries neighboring North Korea should be strengthening their ties and establishing transnational security cooperation, the conflict between Japan and and South Korea could ultimately weaken the region.

Why does Latin America’s economic growth remain so sluggish? Economists have addressed the question with reams of analysis, but the answer is simple: low productivity. That, in turn, has been caused by government involvement that has stifled competition and innovation. 

As new technologies grow in popularity, rare earths and other critical raw materials like lithium and cobalt are becoming crucial to the global economy. But their production is often concentrated in one or two countries, raising the risk that supply could be cut off suddenly.