US President Donald Trump’s aggressive pursuit of trade and tariff wars against major global economies, including China, Canada, Mexico, and the EU, including the deportations of the illegal migrants staying in the country, could potentially backfire, according to some expert opinions.
Experts argue that the US is now using its economic weapon against everyone; they have now started bullying nations such as Panama, China, Russia, Ukraine, and several nations in the EU, like France, in an attempt to make these nations favour the United States.
France is the only country in Europe to have a real independent foreign policy, unlike others who heavily rely on the US for defence and security.
French President Macron has said that “these sorts of actions will strengthen and force EU nations to become more united.”
Additionally, the Trump administration is threatening its three major trade partners with steep tariffs on imports from Canada, Mexico, and China.
The US has increased the duties to 25 per cent on all imports from Mexico and Canada (with a 10 per cent carve-out for Canadian energy products) and a 10 per cent tariff on Chinese goods.
While the Donald Trump administration has termed these actions as necessary for protecting and promoting American interests, they come with severe economic consequences, raising alarms over the possible incoming inflation and disruption in the supply chain.
Additionally, there are concerns about retaliatory measures from the affected nations, like China, a global leader in the supply of rare earth minerals necessary for semiconductors, medicines, fentanyl, and consumer goods, including electronic goods.
However, considering the economic fallout of these aggressive policies, Trump has now demanded Ukraine supply rare earth minerals to the US or else prepare to face consequences.
Besides tariffs, the US has started deporting illegal immigrants back to their native countries; several thousand people have been deported, including Mexico, Canada, and several North African nations.
Apart from these, Trump has also started deporting Indians, whom he considers an important ally in the region. Although there were no official comments from the US authorities confirming the development.
Several reports suggest that a United States military flight carrying 205 illegal Indian migrants departed for Punjab's Amritsar on Monday as the Donald Trump administration intensified its crackdown on undocumented immigrants, sources said. The C-17 aircraft departed for India from San Antonio.
Trump, according to experts, is approaching the matter in the wrong manner.
They say on one side he looks to establish good relations with India, which is one of the world’s most progressive economies and a key ally of Washington in the region, to counter Chinese influence.
However, the deportation moves are likely going to cause some stir in New Delhi, which is considering acquiring US fifth-generation F-35 fighter jets in a deal worth hundreds of billions of dollars.
Also read: The looming threat of a global trade war
The move of sending back Indians could also backfire on the US government, as it could potentially affect the future trade and defence deals between the two nations.
Undeterred, Trump has threatened to impose more sanctions in case the countries resort to countermeasures against the US.
Yet, prolonged trade wars will result in negative economic consequences for all the parties involved.
The trade war is likely to affect sectors including:
Automobiles: The US imports $87 billion worth of vehicles from Mexico annually. Tariffs could raise vehicle prices by as much as $3,000 per car.
Agriculture: Mexico supplies over 60% of US vegetable imports. Tariffs could significantly increase grocery bills.
Energy: The 10 per cent tariff on Canadian oil and natural gas may lead to higher gasoline prices, especially in Midwestern states.
Electronics and consumer goods: Many components used in US electronics manufacturing originate in China. Higher costs on these imports will make consumer electronics more expensive.
In all of this chaos, one thing is certain—the world economic order is likely to reshape, and the US trade war is fuelling the acceleration.
The upcoming months are crucial for the global economic order, as they will determine whether the US economy can withstand the ripple effects of this aggressive trade policy or whether it will suffer the same consequences Trump says he wants to prevent.
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