Nobody wins in Trump’s trade war
June 1, 2018: President Trump last month imposed tariffs on steel and aluminium imports from China and Japan, and has now extended these to Canada, Mexico and the EU. The pretext for these actions is that the aluminium and steel industries are essential to US national security. The US now faces tariff retaliation from all of these countries, as well as legal action through the World Trade Organisation, which is not likely to accept the national security argument.
What appeared to be partly a bullying tactic to improve the US negotiating position on changes to the North American Free Trade Agreement (NAFTA) has now escalated into a trade war with its nearest neighbours.
US actions have also provoked retaliation from China, Japan and the EU, three of its largest global trading partners. Australia has escaped direct rises in US tariffs on its exports because it has a trade deficit with the US, and is not seen as a threat. But trade wars between the largest economies will slow global trade and growth, with negative effects on all, including in Australia.
AFTINET supports fair trade based on human rights, labour rights and environmental sustainability, and campaigns against unfair trade deals. We need fair trade rules which apply to all countries and potentially restrain the market domination of economies like the US. The WTO in its current form is not playing this role. Until we have fairer trade rules, the rest of us will suffer the collateral damage of a war between the giants.