Speaking at the Peterson Institute for International Economics the European Union's Economic Affairs Commissioner, Pierre Moscovici,
has urged world financial leaders to keep a cool head over world trade disputes. He remarked that protectionism was the the biggest risk to Europe's robust economic growth this year. He outlined some of his concerns:
- The US last month imposed import duties on steel and aluminium, mainly against China.
- China retaliated imposing tariffs on more than a hundred US products
- US President, Donald Trump, has threatened to impose tariffs on $150 billion in Chinese imports to the US to punish what US officials call China's predatory industrial policies
Moscovici's concern is that an escalation in protectionist measure will result in a disruption to global supply chains, lower productivity and a distortion of economic growth. He hopes cool heads will prevail... what are the chances of that , eh?
Moscovici raises some genuine concerns, and an escalation in the trade sanctions between US and China are a legitimate concern. However, Trump seems to use bluster and sabre rattling as a call to the negotiating table rather than wanting to necessarily start an all out trade war. However, there will be plenty of market moving headlines generating fears to come regardless of the motives for all the bluster...
