Trump's Tariff Mania

Trump's tariff policy disproportionately harms vulnerable economies, threatening global development, investment, and trade recovery post-Covid crisis, writes Asad Mirza.

- Asad Mirza

THE UN Secretary General Antonio Guterres on Friday (April 11) warned that "nobody wins in a trade war," his spokesman said. "Our concern right now is with the most vulnerable countries who are the least equipped to deal with the current situation,” he further said. The UN Secretary General also noted that the UN Sustainable Development Goals would be impacted "negatively" by a global trade war.

Amid widespread opposition, US President Donald Trump on Wednesday (April 9) signed an executive order on the so-called "reciprocal tariffs" imposing a 10-percent "minimum baseline tariff" and higher rates on certain trading partners.

Sweeping tariffs under US President Donald Trump and counter-measures could have a "catastrophic" impact on developing countries, hitting even harder than foreign aid cuts, the director of the United Nation's trade agency said on Friday. Global trade could shrink by 3-7% and global gross domestic product by 0.7%, with developing countries the worst affected, the International Trade Centre said.

"It is huge," Pamela Coke-Hamilton, executive director of the International Trade Centre, told Reuters, reported a global banking and finance news website. "If this escalation between China and the US continues it will result in an 80% reduction in trade between the countries, and the ripple effect of that across the board can be catastrophic.”

China has been raising its tariffs on the US goods with each Trump increase, raising fears that Beijing may jack up tariffs above the current 84% to even 125%.

"Tariffs could have a much more harmful impact than the removal of foreign aid," Coke-Hamilton said, warning that developing economies risk sliding back on the economic gains they made in recent years.