Latest news with #globalization
Wall Street Journal
5 hours ago
- Politics
- Wall Street Journal
How an ‘America First' Policy Can Benefit U.S. Allies
Rather than complain about President Trump, consider the world from his viewpoint. The way he sees it, the U.S. has spent blood and treasure in largely futile wars to democratize benighted countries, has provided security for largely ungrateful allies, and has seen its economic strength and technological edge erode due to globalization that has benefited America's enemies more than America itself. Hence, Mr. Trump is scrapping green rules that have diminished America's economic security. He is abolishing 'diversity' mania, which has crimped productivity. He is expelling Chinese students from universities where they steal American knowhow and ending the woke madness that pretends 'gender' is whatever you say it is.
Yahoo
19-07-2025
- Business
- Yahoo
Trump's threats to fire the Fed chair and raise tariffs will decimate the dollar
Understanding what motivates normal politicians to follow bad economic advice is difficult enough. Are they paying off some special interest, or do they really believe that two plus two equals three? With Donald Trump, the difficulty of interpreting the motivation for his policies sometimes goes to a whole different level. Does he understand that if he fires Federal Reserve chair Jerome Powell, the Fed will lose anti-inflation credibility and the general level of interest rates will rise, not fall? Does he really believe that Team Trump can design regulation that makes the crypto sector grow to the moon – bitcoin hit $120,000 (£89,000) last week – without causing another financial crisis? Tariffs are another dubious idea, with countries being threatened if they do not agree to a 'deal' by 1 August. Any country that believes that by bending over it will secure lasting peace is kidding itself. Trump is having fun brandishing tariffs and, while he might pause, he is not going to stop. Besides, he and his acolytes see the tariff weapon as a way to exercise power the United States has always had but never exploited. Trump is not just looking to use tariffs as an economic tool. He sees them as a bludgeon that can be used to impose his will on almost any country on almost any issue. Over the long run, Trump's retreat from globalisation, combined with his tariff fetishism, are likely to lower US growth while raising interest rates and inflation. It might be a winning strategy for Trump personally by making him the centre of attention, but it is not a winning strategy for the US economy. And none of this, imposing tariffs, promoting crypto, or attacking the Fed, can be good for the US dollar, the world's reserve currency, which has already plummeted sharply in value this year. The centrality of the dollar, which is the lingua franca of global trade and finance, has long helped the Americans to enjoy substantially lower interest rates than they would otherwise be paying, perhaps 0.5% to 1% lower. This applies not only to government borrowing but to private mortgages, car loans and business loans. Trump sees tariffs as a bludgeon that can be used to impose his will on almostany country on almost any issue The savings amount to hundreds of billions of dollars a year, at a minimum. The dollar gives the US the ability to use financial sanctions in lieu of military intervention, and also gives the US a treasure trove of information on both friends and enemies alike. Dollar dominance was fraying at the edges even before Trump, especially with the Chinese yuan gradually decoupling its dollar peg, and Chinese authorities developing their own international settlement systems. Europe has also been looking to expand the footprint of the euro. Now, however, with attacks against the Fed, the tariff war, and general undermining of the rule of law, what was going to be a gradual decline in the dollar's influence will surely accelerate. The dollar is not going to disappear, but its position could become significantly less dominant over the next decade, with the Chinese yuan becoming more important in Asia, and the euro taking back some of the global influence it lost after the European debt crisis. The dollar's loss will also be crypto's gain, especially in the global underground economy, Trump's rejection of globalisation, and his embrace of chaotic policies, is mostly a lose-lose situation for the US economy that will result in more inflation volatility, higher interest rates, and a spate of financial crises, including in crypto, and possibly surrounding government debt. What will Trump conjure up to distract everyone if the economy turns sour? Kenneth Rogoff is Professor of Economics at Harvard University and author of Our Dollar, Your Problem: An Insider's View of Seven Turbulent Decades of Global Finance, and the Road Ahead Photograph by Eric Lee/Getty
South China Morning Post
18-07-2025
- Business
- South China Morning Post
ExxonMobil's Huizhou project shows global firms' confidence in China's future
While headlines in Washington and Brussels might reflect unease about China's rise, the global business community continues to cast its vote of confidence through real investments rather than rhetoric. The latest example is ExxonMobil's US$10 billion petrochemical complex now taking shape in Huizhou, Guangdong province. More than a major infrastructure project, this investment is a statement that forward-looking multinational firms are bullish on China's future. Located in the Huizhou Daya Bay Petrochemical Industrial Park, the ExxonMobil complex is being built in two phases and will include a world-class steam cracker as well as production facilities for high-performance polyethylene and polypropylene. These materials form the backbone of countless industries, from consumer packaging to automobiles and medical supplies. With naphtha shipments already secured, the company is laying down not just concrete and steel but the groundwork for decades of robust operations. What makes this initiative even more notable is its ownership structure as it is one of the few wholly foreign-owned mega petrochemical projects in China. In an era where some countries advocate economic decoupling and a retreat from globalisation, ExxonMobil is doing precisely the opposite. It is deepening its integration into China's economy with a long-term mindset and strategic clarity. The reasons are compelling. China is not only the world's second-largest economy, it is also a rapidly evolving one. The nation's ongoing urbanisation, growing middle class and demand for cleaner, higher-quality materials have created sustained and dynamic demand for performance chemicals. ExxonMobil, which has more than 130 years of history in China dating back to its predecessor Standard Oil, understands these macro trends well, and the company envisions continuing this relationship for another 130 years. That kind of commitment speaks louder than any short-term political narrative. The Huizhou project fits into China's broader push towards high-quality development . As the country shifts from low-cost manufacturing to innovation-led, environmentally sustainable growth, demand for advanced materials and efficient energy inputs will only increase. ExxonMobil's decision to locate its newest investment in Guangdong, a province at the heart of China's ' reform and opening up ' legacy, further aligns the project with China's developmental priorities. The move also signals a convergence of interests. China needs global expertise and technology to support its modernisation, while multinational companies need access to a vast and growing market.
Bloomberg
15-07-2025
- Business
- Bloomberg
Trump Tariffs Hit Globalization Winners in EU's East, EBRD Says
The outlook for eastern European economies, which for decades have reaped the benefits of globalization, is deteriorating as the US hikes tariffs, according to Beata Javorcik, chief economist at the European Bank for Reconstruction and Development. The region, now mostly in the European Union and the NATO military alliance, has benefited greatly by embracing free trade following the collapse of communism, especially in terms of technology transfers that reshaped its economies.
New York Times
11-07-2025
- Politics
- New York Times
Policy or Cudgel? A Trade Economist on Trump's Hardball Tariffs.
On a cold day in February 1999, a crowd gathered at Georgetown University to protest the tide of globalization that was reshaping much of the world. Some of their targets, like international trade, might seem familiar today, but the protesters would not have fit in at a Trump rally. They were young and firmly on the left. Pietra Rivoli, an economist at Georgetown, was watching, and when one woman seized a microphone and, addressing the crowd, asked, accusingly, 'Who made your T-shirt?' Professor Rivoli became intrigued. She decided to find out. She bought $5.99 T-shirt emblazoned with a colorful parrot in Fort Lauderdale, Fla., and followed its path from Texas cotton fields to Chinese sweatshops and eventually the Walgreens bin in Florida where she had purchased it. In 2005, she published 'The Travels of a T-Shirt in the Global Economy.' Few economics books were as compelling and interesting to me as hers. In a review at the time in The New York Times, I wrote that Professor Rivoli had followed her T-shirt 'like Melville followed his whale.' Her tilt was pro-trade and put off by the 'moral certainty' of protests, which were erupting against the World Trade Organization in coastal cities like Seattle and Boston. Professor Rivoli understood the protesters' concerns about human rights, but did not think shutting down trade would help the intended beneficiaries. A quarter-century later, those left-wing protesters are now middle-aged, and the front lines of the anti-trade movement have passed to the Make America Great Again right, a movement with its own moral certainty. As President Trump moved forcefully against trade, my thoughts turned increasingly to Professor Rivoli. Now a professor emerita still very much engaged in trade issues, she joked that at least, given the attention that Mr. Trump generated, her students no longer treated her lectures on trade as 'nap time.' Want all of The Times? Subscribe.
