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Main » 2019 » April » 25 » US trade war will cause her more harm than the other participants?
US trade war will cause her more harm than the other participants?


According to a study conducted by the European Central Bank, the US trade conflicts with other countries, will have more pressure on the aggressor is, than their competitors. 

Provided that the United States will want to raise tariffs on imports of goods of the camp or its trading partners by 10%, it will have the opposite effect - the state will impose similar tariffs, which subsequently lead to lower economic growth rates bode significant pace than in the EU or China.





Experts note that the increase in tariff and non-tariff barriers on import of goods will lead to the fact that domestic consumers and companies will be looking for an alternative and probably find them on the site. At the date of this effect is likely to be offset by a rise in prices and a decrease in export performance as a result of retaliatory measures that support the rest of the trading partners. 

Against this background, the direct impact on the US economy will be negative and can reduce the activity of 1.5% (on a basic level after the first year). It is necessary to take into account the consequences for the trust which will be accompanied by the tightening of financing conditions, which is also reflected in the GDP figures.

As a consequence we can expect a significant reduction in indicators of world trade and reduce global activity. 

As for China, its producers within such a scenario could increase their competitiveness in third countries, leaving US companies, due to the fact that the American partners of the US will focus on the increase in tariffs for goods from the United States. Accordingly, the impact of trade on the Chinese economy will be positive. 

In turn, the euro area, given the likely increase in the share of the export market, the side effects that occur due to lower global confidence to exceed the growth of competitiveness, which as a result will cause a moderate decrease in activity.

Thus, world trade, provided the current worsening of trade relations, may be reduced by more than than 2.5%, while global activity - by 1%. But in the long term, all three economies will have a negative impact on the trade war, while the US will suffer more than China or the eurozone economy. 

Earlier, Trump announced readiness for the introduction of tariffs against the EU for a total of $ 11 billion, after the WTO announced subsidies for Airbus. What was immediate response from the EC - duties on goods from the United States for US $ 20 billion. And this week, US President announced the probability of tariffs against the EU, as the motorcycle manufacturer Harley-Davidson reported a drop in profits due to unfair tariffs of the European Union.

At the same time China is nearing the completion of trade negotiations. Agreement may be signed in late May - early June, as by that time the parties will be able to settle all the issues. 

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