The year 2018 was a conflict marked by Trading. Countries were covered with threats and punitive tariffs. There is hope that the situation in 2019 relaxed a little?
“The year 2018 was a disaster,” said Claudia Schmucker, a trade expert at the German society for Foreign policy. (DGAP).
An escalating trade conflict between the United States and China, punitive tariffs on steel and Aluminium, also for Europeans, a burst of G7 summit in Canada, a beleaguered world trade organization WTO – these are just some examples of what went on in the past year wrong.
Whether it will in 2019 be better? “The hope is, of course,” says Schmucker. “But it may well be that it simply goes so on. We all know how unpredictable the American President.”
By the end of 2017 Trump (R.) was delighted by his visit in Xi. Shortly thereafter, the trade began to quarrel.
USA vs. China
The trade dispute between the United States and China will hold the world in the coming year. At the G20 summit in Buenos Aires in December, both sides had to stand on a “truce” agreed on: 90 days until the end of February, you waive tariff increases, and negotiate.
“China should make the United States in two Central aspects of far-reaching concessions,” says Rajiv Biswas, Asia chief economist at the British information services provider IHS, Markit. “It would have to reduce its Surplus in trade with the United States and also the protection of copyright of foreign companies in China improve,” said Biswas to the DW.
An agreement within the 90-day period, Jin Canrong considers to be “too optimistic”, especially since there are other conflict issues. However, the Deputy Director of the Institute for International relations at people’s University in Beijing, is optimistic enough to hold a kind of “peace Treaty” in the trade dispute by the end of 2019. “The current ‘weapons would have to be extended still’ several times.”
The US announced in December, the chief financial officer of the Chinese Mobile phone company Huawei arrest makes the situation not easier. “Many Chinese see the US ever since as a rogue state,” says Canrong. “This will affect bilateral relations negatively.”
Conversely, the United States and other countries accuse Chinese Tech firms spying for the government in Beijing. “The Chinese would have to build a lot of trust capital, in order to eliminate this distrust. This is not so easy,” says Rolf Langhammer from the Kiel Institute for the world economy (IfW). “I am sceptical as to whether 2019 trade is politically a better year than 2018,” says the trade expert for the DW.
Sword Of Damocles Car Duties
Also with the Europeans, the United States are in dispute. In March they occupied the steel and aluminum deliveries with penalty duties. And US President Donald Trump has repeatedly threatened to increase the tariffs for European cars. These views are mainly German manufacturers such as Daimler, BMW and Volkswagen nervous, which is why they tried in December 2018, Trump in a personal interview, to persuade.
If you have had some success, it will show in 2019. Punitive tariffs on EU cars will be “not likely,” says IfW trading expert Langhammer. “Otherwise it would not have given this interview, the German car maker with Trump. Trump is a smarter player. He sets the Drohpotenzial very high and is surprisingly willing to take personal conversations again.”
However, the further development is difficult to estimate, as long hammer, because Trumps attitude “changes from day to day.”
New Agreement
Claudia Schmücker, in contrast, believes that Trump car wants to import duties. “In the trade agreements of the United States, Canada and Mexico, rates for car imports in the United States are provided, which make sense only, if the tariffs rise,” said the trade expert of the DGAP. It is therefore likely that the tariffs “will come sooner or later – if trump’s consultants are not able to explain convincingly that this is in the interest of the US economy”.
The renegotiation of the decades-old free trade agreement NAFTA between the USA, Canada, and Mexico is one of Trumps Be in the year 2018. In September, it had managed to him, his neighbors strut from a revised trade agreement.
The European Union hopes, for its part, the United States of an agreement to convince, which also includes the trade in, cars. Whether there is progress to be made, it will be seen in 2019.
Headquarters of the world trade organization in Geneva. By the end of 2019, the WTO may be unable to.
Deadline for the WTO
The most urgent trade policy, homework that must be done in the new year, belongs to the Reform of the welhandel organization WTO.
The biggest point of contention here is, of all things, the procedure for dispute resolution. “Time is of the essence, 2019 to make something happen,” says Schmucker.
The United States block the appointment of Judges in the appellate court, the cases feel in a dispute unjustly treated. Of the original seven Judges, only three are currently the Minimum occupied – according to the articles of Association, to be able to make decisions.
However, the terms of office of two of the three judges expire at the end of 2019. If no agreement is reached, finishing the WTO trade disputes between its 164 member States.
Great Uncertainty
Sure 2019 is that in trading things, much remains uncertain. “As a result, the interest to make long-term investments,” says Claudia Schmucker of the DGAP. “And this has a negative impact on economic growth.”
A further danger is that all of the conflicts issues leave no time for important future investment agreements, technology transfers, digital economy and trade in services.
“The whole level of Negotiation shifts from the traditional trade in Goods to these new areas,” says Langhammer from the Kiel Institute for the world economy. “Nevertheless, it is still fought with the old instruments, with the customs duties.”