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There seems to be no brakes on the escalation of the trade war, with Donald Trump’s administration preparing new tariffs that will affect $200 billion worth of Chinese products.
In between, the United States opened several fronts.
To the conflict with China, we must add its clashes with Mexico and Canada over the North American Free Trade Agreement (NAFTA), with the European Union, and most recently, with Russia.
Talion’s Law emerges in the battle to reconfigure the world’s trade landscape.
In the meantime, the world’s consumers will be hit with more expensive products.
But how did the conflict begin?
motivation
The US claim stems from the trade deficit with China, which has increased by nearly 50% over the past decade, from $258 billion in 2007 to $375 billion last year.
In addition, U.S. trade authorities said the tariffs would serve as a compensation mechanism as the Trump administration accuses the country’s companies of being forced to hand over technology in exchange for access to the Chinese market.
timeline
On March 22, the United States imposed a 25% tariff on imported steel and a 10% tariff on aluminum, affecting products with a total value of $60 billion.
On April 2, the Chinese government responded with tariffs of the same amount, but affecting $3 billion worth of products.
When everything seemed to be resolved, on June 15, the US government once again imposed a 25% tariff on $50 billion worth of Chinese products.
The next day, China responded with $34 billion in tariffs.
On July 11, the U.S. government said it was studying new tariffs worth $200 billion, according to Bloomberg.
Affected Products
The United States imposed tariffs, particularly on high-tech products, including turbines and pumps, electrical equipment and electronics, in response to complaints of BroadCast Unitedlectual property theft.
At the same time, China has hit products developed in sectors such as agriculture, livestock and the automotive industry, where Trump voters are strong.
The products most affected are soybeans, meat, cotton and all types of passenger vehicles.
Other open fronts
The world trade map that President Trump is trying to draw involves more than just a conflict with China, but one with several open fronts.
On May 31, the United States decided to expand aluminum and steel tariffs to the European Union, Mexico and Canada, sparking unrest among trading partners and a wave of responses.
Mexico responded the same day by raising tariffs on agricultural products and U.S. steel, joining China in its bid to pressure Trump’s electoral base.
Mexico warned that the measures would remain in effect “until the United States removes the tariffs it has imposed.”
At the same time, the European Union announced on June 22 that it would impose additional tariffs on a variety of North American products worth US$3.3 billion, expanding the tariffs to US$7.4 billion.
Canada is another country that has decided to respond to the United States.
Earlier this month, Canadian Prime Minister Justin Trudeau announced tariffs on $13 billion worth of U.S. goods.
Russia also responded with steel and aluminum tariffs, and India announced it was preparing a list of products to be taxed in August.
Meanwhile, China, Russia, Canada, Mexico, India and Norway also condemned the United States at the World Trade Organization.
Who is affected?
Consumers in countries hit by the tariffs will be hit hardest, as the taxes will mean higher prices for affected products.
Furthermore, world trade is expected to decrease, thereby affecting the growth of various countries.
Costa Rica will also be hit because the United States is its main trading partner and any decline in growth will directly affect Costa Rican exports.
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