U.S. out of step in globalized world, say LatAm experts

Source: Xinhua| 2018-03-25 14:28:07|Editor: Jiaxin
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MEXICO CITY, March 24 (Xinhua) -- The proposed U.S. tariffs on Chinese imports and other protectionist steps, raising tensions in bilateral trade ties, run counter to today's global economy, Latin American experts said.

The plans "are a disavowal of multilateralism and the ways that have ruled the global economy for the past seven decades," said Argentine economist Jorge Marchini.

Marchini, a researcher at the Latin American Council of Social Sciences, spoke with Xinhua about U.S. President Donald Trump's bid to impose tariffs on up to 60 billion U.S. dollars of imports from China, on the sidelines of the annual meeting of the Inter-American Development Bank (IDB) being held in the Argentine city of Mendoza.

"The unilateral move by the United States shatters complex international balances such as trade relationships, the exchange of goods and also broader links of capital flows between countries," said Marchini.

The protectionist move upsets the widely accepted economic system in place more or less since the end of World War II, which is based on consensus and multilateral agreements, Marchini noted.

Beyond raising tensions in bilateral ties, the move also stands to harm other countries, including many periphery economies of Latin America, he said.

While blaming Beijing for its economic woes, Washington is ignoring the fact that its trade deficit or loss of jobs are due to a global productive restructuring "of which China is an example," he added.

Jose Julio Failoc, an academic coordinator of Peru's School of Municipal Management, agreed that Washington's measures are out of step with the global economy.

"They are policies that are contradictory to a globalized world. These measures lead nowhere, since today's economies are interdependent and complementary," said Failoc, who also attended the IDB gathering.

In contrast to Trump, China has reacted with "caution and restrain, while defending its national interests," working to prevent a trade war,Marchini said.

According to Ronnie Lins, head of the China-Brazil Center for research and business, Washington's decision can also cast a negative impact on global trade.

"The measure seems very dangerous because it will affect all global trade," Lins told Xinhua, adding that "the reasons given by the United States to back the measure are not convincing."

Trump has cited his country's trade deficit with China to justify the move, but the U.S. leader appears to be motivated by his campaign promises to his base to protect U.S. industry and jobs through protectionist measures, said Lins.

"The presidential race for the White House was very competitive. As a strategy, Trump adopted nationalist rhetoric that included measures to benefit specific groups in the United States, obviously to garner votes," said Lins.

This is just the latest controversial unilateral decision by the Trump administration, he said, citing the U.S. withdrawal from the Paris Climate Agreement, the tariffs imposed on imported steel and aluminum, and now a possible "trade war with China."

The tariffs on imported metals are designed "to please a certain group linked to the steel sector," and in this case the strategy may pay off, because "with the steep tariffs, many steel plants with outdated production technology could begin to operate again," Lins said.

Steel workers may benefit, but "the U.S. Federal Reserve will have problems with (inflationary) pressures on many domestic prices, and will have to take strong steps through monetary policy" to control inflation, said the expert.

According to Marchini, escalating tensions and tariffs would impact the United States most, as a significant importer, and ultimately harm U.S. consumers.

"There would be an increase in the price of many products in the United States that are imported and that it does not have the capacity to produce," said Marchini.