One thing is clear, as US President Donald Trump is blowing his path through the announcement of tariffs, experts say: some obligation remains.
Over the past few weeks, Trump has announced a series of deals with the European Union, Japan, Indonesia, Vietnam and the Philippines. Customs duties range from 15% to 20%.
He also threatened the tariffs of 50%, 30% and 35% of the duties announced at major trading partners in Mexico and Canada, indicating that China and India are close.
It is clear who estimates Trump’s tariff rate count is, but “No one is getting zero tariffs,” according to Vina Najibla, vice president of research and strategy at the Asia-Pacific Foundation in Canada.
Trump’s various announcements have led to months of disruption due to the industry, causing businesses to fall into scope and suspend investment and employment decisions.
The World Bank has significantly reduced growth forecasts for nearly 70% of the economy, including the US, China, Europe and six emerging markets, reducing its global growth estimate to 2.3% from 2.7% in January.
Oxford Economics predicts a shallow recession in capital expenditures in groups of seven (G7) countries: Canada, France, Germany, Italy, Japan, the UK and the US.
“What we’re looking at is Donald Trump’s business style. There’s a lot of fuss, a lot of claims, a lot of activity, a lot of B******,” Robert Rogowski, professor of international trade at the Middlebury Institute of International Studies, told Al Jazeera.
“That’s his business model and that’s how he runs it. So he’s driving a lot of his business into bankruptcy. It’s not strategic or tactical. It’s instinctive.”
Rogowsky said he hopes Trump will push back tariff deadlines again from April to July and from August 1st.
“It’s going to be a series of taco tariffs,” Rogovsky said in early May, referring to the acronym “Trump Arrangement Out,” a phrase contrasted by Financial Times columnist Robert Armstrong, describing the US president’s setback on tariffs facing stock market turmoil.
“He’s smashing them again,” Rogowski said. “He’s just giving an image of power.”
Trump’s policy moves before and after the ongoing characterize his dealings with some of the largest US trading partners, including China and the EU.
China’s tariff rate has since gone from 20% to 54%, 104%, 145% and then 30%, but the implementation deadline has changed repeatedly.
The proposed tariff rate for the EU follows a similar pattern, going from 20% to 50% to 30% and 15%, following the latest trade contracts.
The current EU tariff rate applies only to 70% goods, with zero rates applied to a limited range of exports, including semiconductor equipment and certain chemicals.
European steel exports will continue to be taxed at 50%, indicating that new tariffs may be ongoing for the drugs.
Despite the trade deal, many details about how Trump’s tariffs actually work remain unclear.
Whether Trump will announce whether to get more changes back on track, analysts agree that he has entered a new phase of trying to make the world less dependent on the US.
“Now that the initial shock and anger (with Trump’s policy) has subsided, there is a quiet resolve to build resilience and not rely on the US,” Najibla said, adding that Trump is pushing the country to address a long-standing issue that had not been mentioned previously.
Canada, for example, is tackling barriers to trade between Prousia, a historically politically sensitive issue, despite seeing elsewhere to increase exports, said Tony Sloino, director of Canadian Economics at Oxford Economics.
“It’s stupid to not offer it to the US while seeing it as our biggest market, but it’s more resilient to offer it to other markets,” Stillo told Al Jazeera.
Canadian Prime Minister Mark Carney has expressed his desire to reach out to the EU and Mexico and improve tensions between China and India.
This month, Canada expanded its exports of liquefied natural gas beyond the US market with its first shipment of cargo to Asia.
To ease the fallout from Trump’s tariffs, Ottawa is offering relief to Canadian businesses, including automakers, enacting a six-month moratorium on tariffs on some imports from the US, giving businesses time to readjust their supply chains.
There is also “some relief” in the fact that other countries “appear to not imitate Trump Show by imposing their own tariffs.” They have witnessed this attempt to make the rest of the world a strong arm, which doesn’t seem to work, but Anthony M. Solomon Senior Fellow (PIIE) of the Peterson Institute for International Economics told Al Jazeera.
But the world sees how tariffs affect the US economy. “It’s beneficial to other countries too,” Lovely said.
“If we see slowing down as expected, it becomes a story of attention for others.”
The US stock market is the highest ever, but is heavily weighted towards the “magnificent seven.”
Reemerging industrial policy
Trump’s tariffs come in addition to other growing challenges for exporters around the world, including China’s subsidized industrial policy that allows businesses to undercut their competitors.
“We have entered a period of global economic alignment with the reintroduction of industrial policy,” Najibla said, explaining that there is a high possibility that more and more governments will deploy support for domestic industries.
“Country needs to navigate these and find ways to eliminate and reduce excessive reliance on the US and China.”
Still, countries seeking to support their industries must do so, considering rules-based trade agreements such as the World Trade Organization and comprehensive and progressive agreements on the Trans-Pacific Partnership, Najibla said.
“It will take some extraordinary leadership around the world to surround this wild Mustang (Trump) before he divides the world order,” Rogovsky said.
“But it breaks because I think Donald Trump will lead us into a recession.”
