talkpolitics | Entries tagged with trade

The global trade war that has just escalated has already had ripple effects, and its long-term consequences are still unfolding. While the immediate impacts were widely analysed, here are some likely long-term effects:

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So in brief, the long-term effects of the trade war sparked under Trump will include fractured global supply chains, weakened international trade rules, rising protectionism, and a shift toward economic nationalism. While some industries will adapt and new will alliances form, global trade will become more fragmented overall, less efficient, and more politicised, potentially slowing global economic growth and innovation significantly.

luzribeiro

Social media has become flooded with penguin memes after Trump slapped 10% tariffs on all exports from the Heard and McDonald Islands, barren sub-Antarctic Australian territories. Both islands are uninhabited by humans, but home to thousands of penguins.

Nothing can stop you from being dumb, I guess.

abomvubuso

The supply chain crisis, which threatens economic recovery, could continue for another year if world governments do not intervene. Experts are calling for increased government investment in expanding the capacity of ports, railways, roads and storage. There needs to be support to move people from some parts of the economy where demand is not so strong to more key parts where demand is very strong and important for global supply chains.

The volatility of consumer demand during the pandemic, coupled with obstacles to the shipping industry and the negatively affected aviation sector have all led to the worst supply chain crisis in years. In addition to sharp demand reversals, shipping companies have faced a coronavirus-related shortage of port staff and a shortage of truck drivers in the UK, Europe and the US who are essential for transporting goods to their final destinations and returning empty containers. Recent disruptions in supply chains have led to empty shelves in stores and higher prices for an array of products.

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luzribeiro

The global supply chain may be at risk of a possible collapse, warn business leaders

Seafarers, truck drivers and airline workers have endured quarantines, travel restrictions and complex Covid-19 vaccination and testing requirements to keep stretched supply chains moving during the pandemic.

But many are now reaching their breaking point, posing yet another threat to the badly tangled network of ports, container vessels and trucking companies that moves goods around the world.

I doubt a total supply chain collapse will occur, but we may feel the squeeze soon in rising costs and missing items in the stores as this continues.

abomvubuso

A month has passed since the UK has left the united European market and the customs union, shaking up trade relations on the continent to the core.

While the worst expectations for huge lines of trucks at the British ports, food shortages at the stores, etc did not come to pass, lots of companies are warning that they're still struggling to adapt to the new agreements stemming from the trade deal with the EU.

There are about half a dozen sectors that are most affected, and where the difficulties are most acutely felt in the transition period after Brexit. Some of these problems could become chronic unless they're addressed properly.

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luzribeiro

Another deal the Art-of-the-Deal dealmaker Trump has purposely excluded the US from because it wasn't His deal but most certainly is the result of the Trump Amexit strategy... creating void and watching it filled by the competition with US interest absent.

https://time.com/5912325/rcep-china-trade-deal-us/

When the wannabe fuhrer entertained his flat earth base by repudiating the Trans Pacific Partnership, the United States left its political and economic partners in Southeast Asia high and dry, and staring right in the face of China.

I'm fairly certain that Donald Trump never understood what the Trans Pacific Partnership actually was. On the campaign trail, he bellowed that it was bad because it would be good for China (which was excluded from it, and strongly opposed). Trump didn’t know what it is. His talk radio mob didn't either. All they knew was the cheer when Trump screamed “Chiner”.

What is the fallout?

The Chinese stepped in with the Regional Comprehensive Economic Partnership, to fill the void Trump created.

”Experts say the deal — while more symbolic than substantive — is a clear marker of both China’s power and waning American influence in the Asia-Pacific region. Even U.S. treaty allies like Japan, South Korea and Australia moved to strike a bargain with China in the absence of an alternative”.

So congrats, I guess. You sure have made America's rivals great again.

nairiporter

As the world is already bracing for life WITH Covid-19 (rather than POST Covid-19, as that scenario seems unlikely), the focus is shifting to the possible ways of treating the disease - especially the development of vaccines. Most estimates indicate that we're about a year and a half away from having a vaccine - at best. But what will happen once we have it? Who will get it first? Will it be accessible to all?

Well, the fact is, there are no established international rules and principles that could guarantee the fair distribution of such a vaccine.

It's no secret that distribution is defined by supply and demand, i.e. the market. This of course poses the risk of the bulk of the vaccines getting concentrated in the hands of a few countries, notably the US, West Europe, Canada, Japan, because those are the ones who can afford it. We have seen this problems many times with similar medicines.

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fridi

So, Trump has banned travel from Europe (first he sowed confusion by alleging he was banning ALL trade of goods from Europe, then had to backtrack and "make clarifications", on Twitter of course), hoping to defeat the coronavirus with more of his nativism.

Then he used his beautiful mouth (the most beautiful on Earth) to essentially paint a rosy picture of a thriving economy and a nation that's the "best-prepared nation on Earth".

Well, sorry to rain on your party, Mr President Douche, Sir, but your economy is already taking major hits from the outbreak. And it's not the Europeans' fault. Furthermore, your travel ban is going to sink all those nice big air carriers that are the backbone of your economy. But you didn't think of that, did you. No, you didn't.

( But about that travel ban )

abomvubuso

The first stage of the so called trade agreement between the US and China, signed in mid January, is just a temporary ceasefire in the ongoing trade war, not a long-term departure from the tariff policy that started a couple years ago with Trump's change of approach. Still, it's a refreshing halt to what was starting to become a dangerous political direction.

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luzribeiro

The more I'm digging into this allegedly awesome new China deal that Trump is bragging about, the more convinced I get that it's yet another stinky heap of smoke and mirrors crap...

Looking at the Phase 1 deal it looks like it boils down to China buying more soybeans but a lot fewer than what you'd need to break even on what has been lost with the trade war to begin with.

I can't help but think Trump choked to avoid the December tarriffs kicking in and trying to create a "win" amid impeachment. If I'm wrong please show me how. I bet after Christmas we'll hear that China reneged on the deal so Trump can keep his regressive tax policy going on his own supporters.

In a nutshell, Trump only delayed in order to keep the impact of his tariffs from appearing in the box stores in time for Christmas.

Some context: https://www.forbes.com/sites/chuckjones/2019/11/27/trumps-phase-one-china-trade-deal-may-not-save-soybean-farmers/

fridi

I recently got my hands to a podcast to Eric Bolling’s show “America This Week", courtesy of a local Sinclair Broadcasting station. I occasionally listen to that one, despite your probable surprise.

Now, I can tolerate Mr. Bolling. But Sebastian Gorka talking about things he has no idea about (tariffs and trade), I’m not going to be silent. The administration (the head of specifically) has been tossing about the tariff threat without one bit of an idea how tariffs actually work.

His example of the “300% Canadian milk tariff" is eye rolling. First, there is no 300% tariff. The maximum tariff is 270%, but only on milk that is over a quota, and the tariff actually averages less than that. Canada is managing its supply, and, yes, it’s protectionist. However, two things - the US also have milk tariffs to Canada AND the US subsidizes milk production.

And there’s this - MOST of what Canada imports has either zero or low tariffs.

Had the US signed on to the TPP, even the milk tariffs would have gone down.

Thing Americans don’t understand about the Canadian dairy system. It was designed so that the government DIDN’T have to subsidize farming. It is simply an alternative method to the continual subsidies that the US system requires.

mahnmut

It's Victory Day as well as Europe's Day today, so let's talk about Europe and Russia a little bit.

We're all aware of the economic sanctions that the US uses as a tool against many unfriendly regimes: North Korea, Cuba, Iraq, Iran, Yemen, Libya, Syria, Russia, etc etc. The purpose is clear: to pressure the local population to pressure their elites and remove their leaders who might have crossed the US for some reason. But does this tool actually achieve its goal? The sure have caused thousands of deaths of innocent people (nearly half a million children in Iraq alone, 85 thousand kids below 5 years of age in Yemen...) When that tool doesn't yield the desired result, in comes the military: Iraq, Libya. We've talked of the Economic Hit-man scenario many times.

The fact of the matter is, ever fewer people are seeing any efficiency in this tool. People in Europe are most critical of it, Gallup reports that 52% of them believe economic sanctions to be useless. Many are citing the hurting of their own national interests as collateral as a reason for this distrust.

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fridi

For a long time, the EU believed (hoped?) China was the new Japan, but for some "minor" human rights problems. Now the Europeans must have started realizing that they've got not just a new huge economic partner on their hands, but a strategically active, inherently authoritarian superpower.

EU leaders call for end to 'naivety' in relations with China

Macron has a point. He made this point a centerpoint of his statement at the EU-China summit earlier this month. The end of naivety, a European waking up, he called it. This was the first voicing of a realization that's been described in a recent strategic document by the European Commission, painting China as an economic rival striving for technological leadership, as well as a systematic rival that promotes alternative models of governance that are by definition alien to the European one. There were some suggestions in that document as well, like amending EU legislation in a number of fields - from public contracts to personal data protection, to anti-trust law, to communications and the industrial strategy on the development of AI. There's an impression that the EU is fundamentally re-thinking its approach to China, and the shift is so noticeable that even experienced Asian observers tend to describe it as a revolution of some sorts.

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abomvubuso

"China's door will never be shut again, it will be opening up ever more", Chinese president Xi Jinping recently vowed. His statement was well measured and timed, and uttered at the right place: at the launching of the Chinese imports expo earlier this month. It came at a time when the trade war between the US and China is entering a phase of considerable escalation - or maybe even a conclusion. Trump's words regarding this are telling, he said he expects to make a huge deal with China. But he also warned that if the talks fall apart, he's prepared to impose tariffs on all imports from China.

This means that if the US has already imposed tariffs worth 250 billion dollars annually, they'll have to add another 267 billion. Btw, the White House has demonstratively refused to send an official envoy to the expo in Shanghai to hear Xi's promises to open up his economy and remove the trade barriers.

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airiefairie

A New Route From Asia to Europe. Last month, Maersk, one of the world’s largest logistics firms, sailed a cargo ship from Asia to Europe through a route north of Russia for the first time.

All sorts of new geopolitical prospects and implications instantly got into the spotlight. Most reactions were of excitement.

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abomvubuso

We've occasionally been hearing about countries wanting to quit the dollar (China, Iran, Venezuela, all part of the Axis of Evil, i.e. countries who don't agree with us). Now Turkey and Russia are conducting serious negotiations about quitting the dollar in their bilateral trade relations. Erdogan personally announced this, saying his country was determined to stop using the dollar as a payment tool in its trade with many countries, and Russia has agreed to start negotiations specifically to that end. Now, whether these are real plans or just some political statements, that remains to be seen. Erdogan has been saying the same thing since 2016 - first he said he wanted Turkey, Russia, China and Iran to use their national currencies in their trade rather than the dollar, so we shouldn't be that surprised when he's rehashing that same subject once more now. Especially after the diplomatic fallout with the US.

As for Russia, they've been "planning" to quit the dollar in trade and in the economy overall for ages. Now because the US sanctions are about to be expanded, that could affect the Russian banks and companies, so it makes sense that they'd be looking for options to move away from the dollar.

( What are the options? )

kiaa

This map shows the northern and southern sea routes between Europe and East Asia in comparison.

Best part: the Middle Eastern cesspit will no longer be relevant. Also it avoids Somalia so there’s that...

Right now, many ships actually go round Africa rather than having to deal with the Suez authorities. The distance isn't that important. Timing is bigger. You want to sell the cargo at the highest possible price and refuel when it is as cheap as possible. Also there are of course schedules in the ports to consider. Lastly, the difference in weather and climate and how that affects the ship, its cargo, and the crew, will also be a factor to consider. But sure, for some this northern passage will suit.

Of course, the climate processes resulting in this new situation are not something to cheer about. When sea levels rise drastically, some of the most populated areas in the world will be directly affected. As well as the interior, which is already being affected by extreme weather every year.

abomvubuso

How will the world trade order cope with a large, increasingly powerful, increasingly assertive new emerging superpower like China, which quite evidently views globalisation differently from the established power-brokers? That's the question that probably keeps both US and European politicians awake at night these days. The tension is most visible in the US, where Trump's administration has openly accused China of economic aggression, and responded by launching a trade war. Trump's methods could be perceived as too extreme, but the notion that something must be done about China's trade and industrial practices is actually quite prevalent among the mainstream political elites.

Sure, the tone is much milder in Europe, but they're sharing the same concerns. The EU commissioner of trade Cecilia Malmstrom recently asked how the Chinese state-dominated industrial model could be made compatible and placed at equal competitive footing with the open markets, globally. And that's a legitimate question. Because the Chinese model has some competitive advantages.

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Talk politics.

A place to discuss politics without egomaniacal mods.

Entries tagged with trade

What will be the long term effects of the current global trade war?

Friday LOLs. Those poor penguins!

The supply chain is creaking

Another threat

Brexit: One month later

Amexit backfiring

Only for the wealthy

He messed up again, but we're not surprised, are we?

A temporary ceasefire in the lose-lose war

More "diplomatic" BS

Tariffs... How the heck do they work!?

The scourge of sanctions

No more naivety

Open up, China!

A "great victory" for trade?

The anti-dollar alliance

Trade benefits from global warming?

Is the WTO useless?

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June 2025

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