Trump’s Trade Jihad: Reckless pursuit of manufacturing nationalism

‘Third Degree’ methods of coercion unlikely to succeed in long run

- BY K RAVEENDRAN

In his relentless pursuit of what he calls economic nationalism, President Donald Trump's ‘trade jihad’ is targeting newer and more diverse sectors of the global economy.

The latest front in this campaign is the high-tech industry, with a particular focus on smartphone manufacturing. This marks a significant escalation both in terms of scope and intensity, as it now extends beyond traditional industries like steel and automobiles to the digital economy, threatening to destabilize global supply chains that have taken decades to establish.

One of the most striking developments in this crusade is Trump's apparent failure to persuade Apple CEO Tim Cook to shift iPhone manufacturing from India back to the United States. This failure reveals a stark reality: that corporate strategy is not as malleable as Trump may hope, and that the economic logic underpinning global manufacturing is not easily overturned by political pressure, even when applied by the most powerful office in the world. Apple's decision to continue, and even expand, its manufacturing operations in India is driven by a multitude of reasons—cost efficiency, access toa burgeoning market, and geo-political hedging against over-reliance on China among them. It is not simply a case of defying Trump; it is about business logic prevailing over populist bravado.

Trump's reaction to this resistance has been characteristically combative. Rather than recalibrating his approach, he has opted for what can be described as economic coercion through ‘third degree’ methods. These include threats of tariffs and other punitive measures aimed at forcing compliance. By targeting Apple with threats of higher import duties and extending similar threats to Samsung, Trump is attempting to bully global tech giants into aligning with his domestic manufacturing agenda. However, this strategy is fraught with contradictions and perils.