Tariff Pain Runs Deep

DAMAGE: ECONOMIST FEARS REDUCTION OF DEMAND FOR SA MINERALS

- Adriaan Kruger

Things were bad enough in South Africa before US President Donald Trump announced punitive import tariffs on countries that "take advantage" of America by exporting much more to the US than they import, or by restricting US exports with their own import tariffs.

The announcement of import tariffs as high as 60% on exporters targeting the lucrative US market sent share prices, exchange rates, commodity prices and bond yields reeling worldwide.

The main JSE indexes recovered to close to previous levels—only because the dramatic fall in the rand boosted the rand value of the large international companies that are the largest components of the indexes.

The main problem with the US tariffs is that the impact on the global economy and any individual country is far worse than only the effect on the industries involved in trade with America.