Could Tariffs and Trade Changes Under Trump Reshape the Global Economy?

CGTN Europe

CGTN Europe spoke to Marco Forgione, Director General of the Chartered Institute of Export and International Trade.

Transcript

00:00Marco Forgione is Director-General of the Chartered Institute of Export and International

00:04Trade.

00:05Marco, welcome back.

00:06Good to see you.

00:07So, Mr Trump considering imposing a 10% tariff on import of Chinese goods from the 1st of

00:12February.

00:14Is this the glimpse of what the next four years of US trade policy is going to look

00:18like or, to misquote Trump's book, the start of negotiations?

00:24Absolutely.

00:26I think what we can know with certainty is that Trump is going to use every tool in the

00:33toolbox, every weapon in his armory, to negotiate and secure the best possible deal for America,

00:41whether that's through imposing direct tariffs or requiring those who want to trade with

00:47the US to adopt really strict rules of origin and amend their supply chains.

00:53So I think we're seeing a real shift now in the way in which America trades and the

00:58role that the administration feels America could play and should play in the global economy.

01:04One imagines that government flunkies around the world are rushing out to buy Donald Trump's

01:09book The Art of the Deal.

01:10Presumably both of America's neighbours, Canada and Mexico, will be troubled with the mention

01:16of import tax of 25%.

01:19If that stays, if 25% stays in those respective countries, how impactful might those be, if

01:28enforced?

01:29Well, there are a number of impacts that's going to have immediately on the supply and

01:34the trade between Canada and Mexico and the US.

01:38It will encourage production back into the US but also where does that product find a

01:44new market?

01:45In the supply chains that are feeding those manufacturers in Canada and the US.

01:50So what America is doing isn't just going to impact directly Canada, Mexico or China

01:56but will have a global impact because of the highly integrated supply chains.

02:02And the disruption that we're seeing now is, I think, a response to the realisation that

02:08what happens now, what the incoming administration implements now, has much broader impact than

02:17just that direct point-to-point trade flow.

02:19So I think that the reality is that it is often said that you don't need to take Trump

02:24literally but you need to take him seriously has never been more important because you

02:29need to respond to actually what happens as much as the noise that is being created.

02:35And if you do read the art of the deal, you'll understand that making sure that you, the

02:40Trump administration, have the best platform, the strongest platform to do a deal means

02:45destabilising those that you're trying to deal with and that's exactly what's happening

02:49currently.

02:50With that in mind then, what can the European Union expect perhaps in terms of tariffs?

03:00I think Trump is already setting out the stall.

03:02The European Union is going to have to look at not just allowing more American automotive

03:09into the EU, allowing more agricultural produce, but also to shift its purchasing of energy

03:16to the US.

03:18I think those are the fundamentals that need to be looked at before any hope of a longer-term,

03:25more stable trading relationship.

03:27Marco, good to see you.

03:28Thanks so much for coming back on the programme.

03:30Marco Forgione, Director-General of the Chartered Institute of Export and International Trade.

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