Trade

Chinese markets hope and prepare for the best

12 Nov 2024

Stocks shrugged off both Trump’s win and an underwhelming stimulus package for growth in the People's Republic. The buoyancy reflects a risky bet the US won't apply a full 60% trade tariff and optimism that China is better equipped than most countries to deal with higher duties.

Trump’s ‘America First’ revival could backfire

11 Nov 2024

The returning president’s nakedly transactional approach to foreign policy and trade will further erode global principles and make the United States a less reliable ally. Its friends in Europe and Asia will be minded to hedge their bets, ultimately benefiting China and Russia.

Europe lacks scope for fiery Trump trade riposte

8 Nov 2024

With a self-styled tariff man in the White House, the bloc may face blanket export levies. A vast trade surplus, and reliance on the US for key goods like gas, limit the scope for Brussels to respond in kind. Plan B may be to placate Donald Trump by pledging to boost US imports.

Trump will speed China’s journey to self-reliance

8 Nov 2024

Consumption's 59% share of GDP is rising on weak investment. Tariffs threatened by the US president-elect will accelerate the shift to domestic demand. Premier Xi Jinping desires a China less dependent on foreign markets. He may get one, though more abruptly than he envisioned.

Taiwan’s silicon shield wants for reinforcement

7 Nov 2024

Taipei’s exports to the US are surging thanks to chip giant TSMC, but Donald Trump's threatened tariffs would undermine those. How far the president-elect would go to protect the island from Beijing, especially if trade weakens, is unclear. It's time to boost spending on defence.

China wields weak hand in Trump’s Trade War II

7 Nov 2024

The country would suffer a severe blow if the self-styled ‘Tariff Man’ imposes a 60% US levy on Chinese goods. Trade tensions will be harder to de-escalate this time, and Beijing’s reliance on exports to offset slowing GDP growth leaves the $18 trln economy highly vulnerable.

China-EU trade Plan B looks too fiddly

6 Nov 2024

The People's Republic is pushing for alternatives to the bloc's tariffs on imported Chinese electric cars. One idea is minimum pricing. But that mechanism is hard to implement and could also undermine the attraction of local manufacturing. That limits the room to manoeuvre.

Saudi megafund’s success rests on fuzzy local bets

5 Nov 2024

The kingdom’s $950 bln Public Investment Fund is best known for outlandish construction schemes and flashy foreign forays. But its biggest and fastest-growing division houses young domestic firms. While some may thrive, it’s less clear they can guarantee the vital pivot from oil.

Chinese planners face an anxious wait

5 Nov 2024

The outlook for trade will worsen regardless of who wins the US election. It may take months for the new president’s policies to take shape. Beijing also needs time to assess how well its plan to stimulate its $18 trln economy is working. No point wielding any bazookas yet.

Biden’s precise industrial policy may soon mutate

24 Oct 2024

National Security Adviser Jake Sullivan says protecting key technology and renewable energy was an apt response to China’s threat, while similar policies from allies vindicate the US approach. But if Donald Trump returns, the same tariffs and sanctions may become blunter weapons.

Old theories offer new insight into global rivalry

14 Oct 2024

The geographer Halfold Mackinder in 1904 proposed that future strife would revolve around control of Eurasia. Though the modern world is very different, it’s one way to understand conflicts in Ukraine and the Middle East and the showdown between the United States and China.

Autos’ car crash ups the likelihood of EU airbags

30 Sep 2024

Stellantis and Volkswagen delivered big profit warnings, amid falling demand for cars. Their woes may encourage policymakers to vote through tariffs on Chinese rivals and go easy on EU carbon fines. But falling output and strained consumers mean carmakers need self-help too.

EU deforestation ban creates a hazy trade future

23 Sep 2024

The European Union wants to ban agricultural imports from deforested land. The rules have laudable aims but will impact $400 bln worth of goods. Developing nations are already exporting elsewhere. To avoid losing vital supplies, Brussels can compensate farmers or lower standards.

China-EU trade spat’s next swipe may hit LVMH

23 Sep 2024

Beijing is weighing up retaliating against EU tariffs on electric cars. Targeting the French luxury giant and its rivals would cause minimal strategic pain and hit Paris rather than Berlin. Higher consumption taxes, rather than import duties, could also fit with domestic reforms.

ASML faces bigger problems than China

16 Sep 2024

Fears of US tech export curbs have pummelled the $320 bln Dutch firm’s shares. A longer-term worry is that the growth of AI leads to new technologies, and less need for ASML’s machines that make chips smaller and efficient. That, more than trade wars, may hurt its rich valuation.

The European Union risks a sad, bad future

16 Sep 2024

The EU economy is stagnating, while Russia, China and even the United States may bully the bloc. There are potential fixes, as former European Central Bank boss Mario Draghi set out last week. But the EU and its members are currently in no position to implement them.

China wins only token victory in EU car wars

13 Sep 2024

Spanish PM Pedro Sanchez wants Europe to drop duties on Chinese EVs, suggesting the Middle Kingdom’s plan to turn member states is working. But blocking the levy will be legally tricky, and Brussels’ credibility is at stake. Beijing faces a long road to upend the union’s plans.

Trade War II will be easy to lose for China

4 Sep 2024

The hit to its exports from higher US tariffs threatened by Presidential nominee Donald Trump would be severe. Beijing’s failure to abide by the terms of past truces will make de-escalation hard to achieve, so will its determination to export its way out of a growth slump.

Shipping rates yet to signal a calmer Middle East

22 Aug 2024

The US is pushing hard for an Israel-Hamas peace deal. But shipping executives expect rates to stay high this year as vessels avoid the Red Sea. While only a rough gauge of regional tensions, the freight experts may be more accurate forecasters than ceasefire optimists.

Iran danger marks return of oil’s risk premium

13 Aug 2024

Conflict in Gaza and tit-for-tat attacks in the Middle East have desensitised markets to possible supply shocks. A US warning of imminent retaliation against Israel changes that. Despite weaker demand, oil prices reflect the dangers of infrastructure and tankers becoming targets.