The Biden Administration will have to address numerous trade related issues in the coming months. It’s expected the administration will make moves back to a multilateral trading system but what will that mean in real world terms?
In late December, the Trump administration proclaimed Vietnam as a currency manipulator and threatened to slap steep tariffs on Vietnamese goods bound for the US. Those involved in both countries held their breath. Would Vietnam become the parting shot target of Trump’s long and destructive trade-related wrath?
In the end, Trump’s U.S. Trade Representative (USTR) refrained from any last-minute action. His office passed on findings to the incoming Biden team, adding to what is an ever-lengthening agenda of recalibrating global relations and American strategic and economic priorities. The new administration must in the process confront numerous trade-related issues that stretch across several oceans and dozens of borders. It will have its hands full.
“Trade has become a very difficult topic in the United States. When Trump was talking in these crude nationalistic terms about trade, there were lots of people who found a resonance in that. So, I think this poses real constraints on the Biden administration,” explained Richard Baldwin, professor of iinternational economics at the Geneva-based Graduate Institute, during an online press conference. He added: “The rules-based multilateral trading system is wonderful and has been 70-years or so, and Trump broke it. It can be and should be fixed. It needs to be fixed.”
Real World Implications
These policies have real-world implications, as everyone in the US from Midwestern farmers to coastal port officials discovered during the tumultuous years of Trump’s trade-related dictates. The changing of the guard in Washington comes at a time when economies around the world still flounder because of COVID disruptions, although many should at least begin to recover in 2021. That, naturally, will boost global trade, with certain categories — car exports and imports, for example — expected to show real gains.
Add to this all sorts of other issues, notably the Brexit aftershocks.
Then, there are domestic pressures and Biden’s own Made In America campaign. Biden himself appears to want to balance the welfare of American business with a desire to re-engage strategic allies and partners elsewhere. He will almost certainly jettison Trump’s unilateral and punitive approach to conducting foreign relations, including trade.
At the same time, the Biden administration won’t radically alter trade policies, at least not yet. It will likely take a deliberate and slow approach to tariffs and other aspects of trade. “The Biden mantra from during the campaign, and still, has been essentially on trade, no sudden moves,” said Bill Reinsch, who holds the Scholl chair in international business at the Center…
View the full article free in the AJOT Digital Edition or by Logging in!View Digital Edition