What the newspapers have already called a “has officially startedcommercial war“Between the United States and three of their main commercial partners globally, that is China, Canada And Mexico. The series of executive orders signed in recent days by the US president was triggered it Donald Trumpwhich imposed duties of the 25% on the imports of the United States on a vast assortment of Canadian and Mexican goods and the 20% on the Chinese ones. The announcement has already led to a drop in both international and European bags, aware of being destined to become the next target of this “commercial war”.
What the duties are and how those imposed by the USA work
Summarizing in a few lines, for Employment duties We mean a surcharge that the importers of a certain country have to pay to get the goods and put it on the market. The basic idea of this protectionist vision is that importing a product becomes so unconvenient as to make it cheaper produce it directly in your country. The problem is that, provided that this happens in the medium and long term, It is certain that the products in question will cost much more in the short termgiven that the greater import cost will fall on final consumers, who will have to take a generalized increase in prices. Making a practical example, all the companies that need steel or aluminum for their products in the United States must use the “made in the USA” today or pay much more to pay for foreign imports. The result is that even a can of Coca Cola will end up costing much more for final consumers.
Dice uses as a political commercial retaliation tool
This serious repercussion on consumers is so predictable and undeniable that Donald Trump himself admitted him during his First speech on the state of the Unionwho was held at the United States congress on Tuesday 4 March. During his speech he also justified the reasons for his “commercial war”, confirming the considerations of many observers. There threat of duties is A tool that Trump uses to obtain from other countries concessions also in different fields from the economic one. For example, in the case of Canada and Mexico, the official excuse for the duties of 25% on imports (established on 4 February last and “frozen” for a month) is the responsibility of the two countries in the opioid crisis in the United States, which every year cause hundreds of thousands of deaths per overdose. In particular, according to Trump, Ottawa and Mexico City do not do enough to counter the traffic of the components to produce the Fenanyla powerful pain reliever.
The reactions of Canada and China to commercial duties
As the Canadian Prime Minister said Justin Trudeau in announcing the duties of 25% on 155 billion dollars of US goods starting from midnight on March 4, the US commercial measures “have nothing to do with Fenanyl”, which is just a Legal pretext to damage Canada and its economy. The reaction of the Chinese government is more cautious, which however announced 10% duties on the imports of a well -selected series of US products, including technological components and food genres such as soy, sorghum, pork and beef, fish products, fruit, vegetables and dairy products. A limited list, but able to hit the producers of the Midwest of the United States, where support for the Republican Party and Donald Trump is very large.
The US objectives
This muscle and “humiliation” policy of the main partners and allies of the region will certainly have a very serious impact on the economy of Mexico and Canada. Also because Trump added that there are no concessions from their governments that they will be able to withdraw them. As he said on March 4, his intention is keep them in force Until the commercial scale – i.e. the relationship between imports and exports – US with the two countries will have returned to tie. Very improbable thing both in the short and in the medium term, given that the United States import many more products than those who export to the two neighbors.
The distrust of the world bags and the reaction of the European stock exchange
The commercial war that also a conservative newspaper such as the Wall Street Journal he defined “a madness” has already had serious repercussions also on the main world bags. On Tuesday 4 March, at the opening of the US markets, the S&P 500 index, which traces the trend of the actions of the 500 largest companies in the United States, has lost it 0.7%after having already lost the1.8% Monday. It did not go better even for the European bags, where the awareness is widespread that the next target of everyone against all of Trump is precisely the European Union. On March 4, the Euro Stoxx 50, which summarizes the trend of securities of various European bags, dropped by 2.5%.
