Latest news with #TrumpShock
Yahoo
7 days ago
- Business
- Yahoo
Opinion - Trump is breaking the global order, but maybe that's a good thing.
Long before President Trump reclaimed the White House, the post-World War II global order was fraying. Multilateral institutions were losing relevance, globalization was under siege and great-power politics — including 'might makes right' — had reemerged with a vengeance. From AI arms races to trade wars, the world appeared sliding into disorder. Trump's second term has turned disruption into a virtual doctrine, including undermining America's longstanding strategic partnerships with countries such as India and South Africa. But, at the global level, his disruption might be precisely the jolt the international system needs. His critics decry the president as a bull in a geopolitical china shop. They point to Trump's withdrawal from multilateral pacts, his scorched-earth tariff policies and his disdain for NATO allies. Yet amid the upheaval, one question demands serious thought: Could the 'Trump Shock,' which has upended global norms and set in motion the revision of trade and security architecture, actually lay the foundation for a new, more balanced international system? The so-called 'rules-based international order' has long been a myth. Western powers have invoked a rules-based order as gospel while only selectively adhering to it. From military interventions to extraterritorial sanctions and weaponized finance, the West has bent or broken its own rules when convenient. Trump has simply been more honest about it. In that honesty, there may be a kind of reform — exposing the myth to force a long-overdue reckoning. Take trade. Trump's tariff-first strategy has rattled markets, but it also has exposed long-festering trade imbalances. By prioritizing U.S. manufacturing and bilateral deals, his administration has reignited global debates on fair trade, intellectual property theft and overreliance on China. Nations like India and Australia seem poised to benefit from the shifting trade currents Trump has unleashed. Trump is not so much dismantling globalization as retooling it — from 'free trade at any cost' to 'strategic, reciprocal trade.' The conversation has changed. That's not nothing. Or consider NATO and Trump's resolve to end European free-riding. His tough talk on NATO — once mocked — is now manifesting in budget shifts across the continent. Allies long dependent on the U.S. for their security are finally raising their defense budgets, realizing that a world without the American umbrella may be approaching. Several NATO members have now edged closer to the 2 percent GDP target for defense. It is extraordinary that, for decades, Europe chose not to look after its own security and instead rely on America. As Polish Prime Minister Donald Tusk recently pointed out, Europe does not lack economic power or demographic strength — there are '500 million Europeans begging 300 million Americans to defend them against 140 million Russians.' But today, thanks to Trump, Europe is being nudged toward military self-reliance, thereby strengthening European Union-led defense initiatives. A more militarily self-reliant Europe, cooperating with but not dependent on the U.S., would yield a stronger transatlantic alliance, while allowing Washington to reorient toward the Indo-Pacific region. Perhaps the clearest example of disruptive reform is Trump's full-throttle decoupling from China. From technology-transfer restrictions to trade war escalation, the U.S. is reversing decades of policy that effectively enabled China's authoritarian rise. By blocking exports of advanced chips to China, the Trump administration is also seeking to thwart China's AI expansion. The ruling Chinese Communist Party today oversees an 'Orwellian techno-totalitarian surveillance state,' in the words of former Rep. Mike Gallagher (R-Wisc.). China's objective is to first become the regional hegemon in Asia and then to challenge the U.S. for global primacy. In this light, the Trump administration is seeking to reorient the U.S. military architecture toward the Indo-Pacific to prepare for and win a potential war with China, including deterring a Chinese attack on Taiwan, according to the leaked 'Interim National Defense Strategic Guidance' signed by Secretary of Defense Pete Hegseth. 'China is the Department's sole pacing threat,' the guidance says. While Trump's rhetoric is fiery, the effect is pragmatic — diversifying supply chains, reinforcing domestic production and galvanizing allies to define their own red lines with Beijing. Washington's latest push to bind trade deals to 'market economy' status — a jab at China's state-subsidized model — might reshape the rules of 21st-century commerce. To isolate Beijing, the U.S. is seeking to restrict allies' ability to sign trade agreements with any 'non-market economy' like China without full consultations with Washington. This move aims to align allied trade policies with American interests, particularly regarding China's economic practices. Trump's 'drill, baby, drill' mantra is controversial, but the call for increased energy production has helped soften global prices and offered relief to major energy importing nations like Japan and India. At the same time, it is set to make the U.S. less dependent on unstable energy exporters, giving Washington new leverage in global markets. There is no denying Trump's style is combative and often norm-defying. But the substance beneath the noise — reshaping of global trade, challenging Chinese hegemony and pushing for alliance rebalancing — deserves a more nuanced evaluation. In a world where the old order is obsolete but the new one has not yet emerged, today's disruptor, Trump, might eventually come to be seen as an accidental reformer. His presidency is asking hard questions: Should democracies depend on autocracies for critical goods? Why isn't Europe capable of defending itself? Is globalization serving middle-class workers or only multinational companies? These are issues policymakers content with the status quo never dared challenge. Trump is forcing the conversation. And while sowing some chaos, he is shaking the international order toward a long-overdue realignment. Whether history sees him as a reckless disruptor or a reluctant reformer will depend on whether his shock therapy leads to a sturdier global architecture — or merely a deeper rupture. Brahma Chellaney is a geostrategist and the author of nine books, including the award-winning 'Water: Asia's New Battleground.' Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
The Hill
7 days ago
- Business
- The Hill
Trump is breaking the global order, but maybe that's a good thing.
Long before President Trump reclaimed the White House, the post-World War II global order was fraying. Multilateral institutions were losing relevance, globalization was under siege and great-power politics — including 'might makes right' — had reemerged with a vengeance. From AI arms races to trade wars, the world appeared sliding into disorder. Trump's second term has turned disruption into a virtual doctrine, including undermining America's longstanding strategic partnerships with countries such as India and South Africa. But, at the global level, his disruption might be precisely the jolt the international system needs. His critics decry the president as a bull in a geopolitical china shop. They point to Trump's withdrawal from multilateral pacts, his scorched-earth tariff policies and his disdain for NATO allies. Yet amid the upheaval, one question demands serious thought: Could the 'Trump Shock,' which has upended global norms and set in motion the revision of trade and security architecture, actually lay the foundation for a new, more balanced international system? The so-called 'rules-based international order' has long been a myth. Western powers have invoked a rules-based order as gospel while only selectively adhering to it. From military interventions to extraterritorial sanctions and weaponized finance, the West has bent or broken its own rules when convenient. Trump has simply been more honest about it. In that honesty, there may be a kind of reform — exposing the myth to force a long-overdue reckoning. Take trade. Trump's tariff-first strategy has rattled markets, but it also has exposed long-festering trade imbalances. By prioritizing U.S. manufacturing and bilateral deals, his administration has reignited global debates on fair trade, intellectual property theft and overreliance on China. Nations like India and Australia seem poised to benefit from the shifting trade currents Trump has unleashed. Trump is not so much dismantling globalization as retooling it — from 'free trade at any cost' to 'strategic, reciprocal trade.' The conversation has changed. That's not nothing. Or consider NATO and Trump's resolve to end European free-riding. His tough talk on NATO — once mocked — is now manifesting in budget shifts across the continent. Allies long dependent on the U.S. for their security are finally raising their defense budgets, realizing that a world without the American umbrella may be approaching. Several NATO members have now edged closer to the 2 percent GDP target for defense. It is extraordinary that, for decades, Europe chose not to look after its own security and instead rely on America. As Polish Prime Minister Donald Tusk recently pointed out, Europe does not lack economic power or demographic strength — there are '500 million Europeans begging 300 million Americans to defend them against 140 million Russians.' But today, thanks to Trump, Europe is being nudged toward military self-reliance, thereby strengthening European Union-led defense initiatives. A more militarily self-reliant Europe, cooperating with but not dependent on the U.S., would yield a stronger transatlantic alliance, while allowing Washington to reorient toward the Indo-Pacific region. Perhaps the clearest example of disruptive reform is Trump's full-throttle decoupling from China. From technology-transfer restrictions to trade war escalation, the U.S. is reversing decades of policy that effectively enabled China's authoritarian rise. By blocking exports of advanced chips to China, the Trump administration is also seeking to thwart China's AI expansion. The ruling Chinese Communist Party today oversees an 'Orwellian techno-totalitarian surveillance state,' in the words of former Rep. Mike Gallagher (R-Wisc.). China's objective is to first become the regional hegemon in Asia and then to challenge the U.S. for global primacy. In this light, the Trump administration is seeking to reorient the U.S. military architecture toward the Indo-Pacific to prepare for and win a potential war with China, including deterring a Chinese attack on Taiwan, according to the leaked 'Interim National Defense Strategic Guidance' signed by Secretary of Defense Pete Hegseth. 'China is the Department's sole pacing threat,' the guidance says. While Trump's rhetoric is fiery, the effect is pragmatic — diversifying supply chains, reinforcing domestic production and galvanizing allies to define their own red lines with Beijing. Washington's latest push to bind trade deals to 'market economy' status — a jab at China's state-subsidized model — might reshape the rules of 21st-century commerce. To isolate Beijing, the U.S. is seeking to restrict allies' ability to sign trade agreements with any 'non-market economy' like China without full consultations with Washington. This move aims to align allied trade policies with American interests, particularly regarding China's economic practices. Trump's 'drill, baby, drill' mantra is controversial, but the call for increased energy production has helped soften global prices and offered relief to major energy importing nations like Japan and India. At the same time, it is set to make the U.S. less dependent on unstable energy exporters, giving Washington new leverage in global markets. There is no denying Trump's style is combative and often norm-defying. But the substance beneath the noise — reshaping of global trade, challenging Chinese hegemony and pushing for alliance rebalancing — deserves a more nuanced evaluation. In a world where the old order is obsolete but the new one has not yet emerged, today's disruptor, Trump, might eventually come to be seen as an accidental reformer. His presidency is asking hard questions: Should democracies depend on autocracies for critical goods? Why isn't Europe capable of defending itself? Is globalization serving middle-class workers or only multinational companies? These are issues policymakers content with the status quo never dared challenge. Trump is forcing the conversation. And while sowing some chaos, he is shaking the international order toward a long-overdue realignment. Whether history sees him as a reckless disruptor or a reluctant reformer will depend on whether his shock therapy leads to a sturdier global architecture — or merely a deeper rupture. Brahma Chellaney is a geostrategist and the author of nine books, including the award-winning 'Water: Asia's New Battleground.'
Mint
25-04-2025
- Business
- Mint
India faces $14-billion export losses over US tariffs, NIPFP warns
New Delhi: India could incur direct export losses of about $14 billion, or 0.38% of GDP, owing to reciprocal tariffs imposed by US President Donald Trump, according to a presentation by the National Institute of Public Finance and Policy (NIPFP) on Friday. NIPFP, an autonomous research institute under the ministry of finance, raised concerns about import surges and dumping across various sectors, fuelled by the US-China decoupling. The presentation by NIPFP economists Rudrani Bhattacharya, Radhika Pandey and Manish Gupta highlighted that while Indian exports were likely to be affected by tariffs, a trade deal could mitigate some of the effects, though at the cost of sacrificing India's trade surplus with the US. The presentation, titled 'Impact of Trump Shock on Indian Economy - An Assessment' cautioned that imports could surge as products were diverted from China, Vietnam and other countries, while rising recession and inflation risks in the US could dampen global growth, affecting India's growth prospects. While goods exports face a direct hit, the services sector—key to India's overall export growth—could suffer due to stagflation in the US. Broad sectors such as electronics, gems and jewellery, machinery, textiles, metals, and transport equipment face heightened risk because of elevated tariffs, according to the presentation. Gems and jewellery are especially vulnerable as competing countries benefit from lower tariffs, potentially eroding India's market share, it noted. NIPFP said labour-intensive industries such as footwear, garments, rubber articles, furniture and toys had the potential to capitalise on opportunities from countries with higher tariffs than India. "For example, for footwear, the major exporters to the US are China and Vietnam, but they are subject to higher tariffs. India could gain some market share but needs to scale up its manufacturing," it added. India's goods trade surplus with the US was $41.18 billion in FY25, 16.6% higher than the previous year's $35.32 billion. This growth was due to an 11.6% rise in exports to the US to $86.51 billion, while imports from the US grew 7.4% to $45.33 billion. Economists at NIPFP anticipate that the US-China decoupling could lead to dumping of key commodities such as resins, paper and rubber into India. "On account of Chinese retaliatory tariffs on the US, the dumping of agricultural products into India cannot be ruled out," they added in the presentation. The economists suggested strategies to address trade imbalances and enhance India's global trade position, such as reducing the trade surplus with the US by boosting imports of oil and other products, accelerating trade negotiations, securing sector-specific exemptions, and diversifying exports to the EU, UK, and ASEAN. They also recommend strengthening domestic manufacturing through initiatives such as Make in India, focusing on semiconductors, renewable energy and electronics, while offering targeted concessions on select US goods, expanding production-linked incentive schemes for vulnerable sectors, and improving export infrastructure and logistics. According to the presentation, India may either be able to grab trade diversification opportunities thrown up by differential tariffs, or the impact of US trade policies on global growth, including India, could be closer to the global financial crisis of 2008-09. New Delhi: India could incur direct export losses of about $14 billion, or 0.38% of GDP, due to reciprocal tariffs imposed by US President Donald Trump, raising concerns about import surges and dumping across various sectors, fueled by the US-China decoupling, according to a presentation by the National Institute of Public Finance and Policy (NIPFP) on Friday. The presentation by NIPFP economists Rudrani Bhattacharya, Radhika Pandey, and Manish Gupta highlighted that while Indian exports are likely to be impacted by tariffs, a trade deal could mitigate some of the effects, though coming at the cost of sacrificing India's trade surplus with the US. The presentation titled 'Impact of Trump Shock on Indian Economy - An Assessment' cautioned that imports could surge as products are diverted from China, Vietnam, and other countries, while rising recession and inflation risks in the US could dampen global growth, affecting India's growth prospects. Additionally, while goods exports face a direct hit, the services sector—key to India's overall export growth—could suffer due to US stagflation. Broad sectors such as electronics, gems and jewellery, machinery, textiles, metals, and transport equipment face heightened risk due to elevated tariffs, according to the presentation. Gems and jewellery, in particular, are vulnerable, as competing countries benefit from lower tariffs, potentially eroding India's market share, it noted. The presentation highlighted the potential for labour-intensive industries like footwear, garments, rubber articles, furniture, and toys to capitalize on opportunities from countries with higher tariffs than India. "For example, for footwear, the major exporters to the US are China and Vietnam but they are subject to higher tariffs. India could gain some market share but needs to scale up its manufacturing," it added. India's goods trade surplus with the United States for FY25 reached $41.18 billion, a 16.6% increase from the previous year's $35.32 billion. This growth was driven by an 11.6% rise in exports to the US, totaling $86.51 billion, while imports from the US grew 7.4% to $45.33 billion. Economists at NIPFP anticipate that, due to the US-China decoupling, key commodities such as resins, paper, and rubber could face dumping into India. "On account of Chinese retaliatory tariffs on the US, the dumping of agricultural products into India cannot be ruled out," they added in the presentation. The NIPFP economists suggested strategies to address trade imbalances and enhance India's global trade position, including reducing the trade surplus with the US by boosting imports of oil and other products, accelerating trade negotiations, securing sector-specific exemptions, and diversifying exports to the EU, UK, and ASEAN. They also recommend strengthening domestic manufacturing through initiatives like "Make in India," focusing on semiconductors, renewable energy, and electronics, while offering targeted concessions on select US goods, expanding PLI schemes for vulnerable sectors, and improving export infrastructure and logistics. According to the presentation, India could either be able to grab trade diversification opportunities due to differential tariff advantages, in the aftermath of the reciprocal tariffs, or the impact of disruptions due to US policies on global growth, including India, could be closer to the global financial crisis (2008-09). First Published: 25 Apr 2025, 06:32 PM IST
Bloomberg
08-04-2025
- Business
- Bloomberg
Trump's Tariffs Collide With Deepening China Shock
I'm Shawn Donnan, a senior writer for economics in Washington. Today we're looking at twin shocks hitting the world economy. Send us feedback and tips to ecodaily@ And if you aren't yet signed up to receive this newsletter, you can do so here. For a quarter century at least the world has been living with the effects of an epochal economic shock as China's rise has reshaped whole industries and communities around the world. But that jolt to the global economy has been joined by another over the past week: The Trump Shock is truly here.
Bloomberg
25-03-2025
- Business
- Bloomberg
Harvard's Jin is Optimistic on China's Economy
Harvard's Dr. Keyu Jun believes that the the 'Trump Shock' might well be the spur of a more pragmatic, pro-growth-focused agenda in China. She discusses why exclusively with Rebecca Choong Wilkins and David Ingles on the sidelines of the 'HSBC Global Investment Summit' in Hong Kong. (Source: Bloomberg)
