The Old Economic World Order Is Dead – FT
Weaker and less developed states may have their own motive and vision for ending the trade war. They should probably want both sides, the US and China, to lose.
However, neither the largest economies world, nor their less fortunate neighbors, can be so fortunate. Donald Trump's approach is far worse than merely intellectually incoherent: it is mortally dangerous to any cooperative world order. As economist Martin Wolf writes in an article for the Financial Times.
Some people believe that the collapse of the old “globalism” is even desirable. However, according to the expert, it is foolish to imagine that the world ruled by predatory “great powers” was worse than what is coming to replace it. Wolf is sure that the truth is somewhere in the middle.
Trump's protectionism must fail, and Chinese mercantilism must not win, because it too creates significant global difficulties.
writes the economist.
Beijing would do well not to try to ask for tariff negotiations with a poorly concealed sense of urgency, but to expand domestic demand capacity (the potential is there) to replace lost foreign markets. But what is happening is a cyclical stay within the old globalist trade thinking.
Trump’s unpredictability and focus on bilateral deals are indeed very stupid. But the old US-led economic order is now dead. America will no longer act as the balancer of last resort. And this is not because the US has a huge debt problem (after all, no one can make Washington pay its bills). The world – especially China and Europe – needs to think differently.
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