Since returning to the White House a year and a week ago, United States President Donald Trump has applied tariffs against virtually every other country and territory in the world.
Inspired by this policy, other national governments are starting their tariff wars against other nations.
Last Wednesday (21), the president of Ecuador, Daniel Noboa, announced a 30% tariff on imports of products from Colombia, alleging a lack of cooperation in actions against drug trafficking.
The Gustavo Petro government responded with a suspension of the sale of electricity to Ecuador and a tariff, of the same percentage imposed by Noboa, on more than 50 Ecuadorian products.
Also last week, the Indian government raised the basic customs duty for the import of flat screens from 10% to 20%.
Prime Minister Narendra Modi’s administration stated that this measure is part of the “Make in India” program, created in 2014 with the aim of encouraging companies to develop and manufacture products in India.
Before that, at the turn of the year, Mexico implemented tariffs of 5% to 50% on imports of 1,463 product lines from countries with which it does not have a trade agreement, including China, Russia and Brazil.
One of the main targets of Trump’s tariff war, China was another country that decided to show its weapons in this area.
Also at the turn of the year, it implemented a 55% tariff on beef imports that exceed the new quota limits.
In December, Beijing had already announced tariffs of up to 42.7% on European Union dairy products, alleging unfair subsidies, but also retaliating against the bloc for surcharges of up to 45.3% on Chinese-made electric vehicles.
This Tuesday (27), the Bloomberg agency reported that South Africa is considering imposing tariffs of up to 50% on vehicles from China and India, its partners in the BRICS, to protect its automotive industry.
In an interview with People’s GazetteJosilmar Cordenonssi, professor of economic sciences at Universidade Presbiteriana Mackenzie, said that Mexico’s case is directly related to Trump’s tariffs, because Washington is pressuring the neighboring country “to impose tariffs equal to those that the United States is imposing on its trading partners, so that Mexico does not benefit by importing cheaper products than the United States and re-exporting them to the United States.”
In the case of the Colombia-Ecuador fight, the expert stated that he believes that an ideological dispute (Noboa is on the right, and Petro, on the left) could be behind the tariffs imposed last week, even more so with the Colombian presidential election on the radar (the first round will be on May 31), but that “these tariffs can be renegotiated or revoked quickly”.
In general, however, Cordenonssi stated that the tariffs being announced reflect a scenario in which the World Trade Organization (WTO) “practically no longer exists, there is no longer any international trade law, rules, principles.”
“We are living in a very worrying moment, with a reduction in free trade, an increase in protectionism and a tendency for dynamism in the international market to decline”, warned the analyst.
In this sense, Cordenonssi stated that middle powers, such as Brazil, have more to gain by seeking a revitalization of the WTO and negotiating trade agreements outside the China-USA axis, such as the European Union-Mercosur and Japan-Association of Southeast Asian Nations (Asean) pacts, without falling into the trap of adhering to tariff wars and protectionism.
“This is the path we have to follow. Now, there may be countries that will fall into the populist temptation of closing themselves off, making short-term political gains, but [devem] lose the race in the medium and long term. Having a more closed population and economy means that they will be less productive and poorer”, he pondered.
