Feb 19 2024 38 mins
In this special edition of Current Accounts, the Hinrich Foundation’s podcast on global trade, Patrícia Vasconcellos from the US Association of Foreign Press Correspondents and Keith Rockwell, former WTO director and senior research fellow at the Hinrich Foundation delve into the evolving global trade patterns.
There is a notable shift in global trade patterns, particularly in case of the US. This is a result of deliberate decoupling initiatives spanning two successive US administrations, marked by tariffs on Chinese imports. The US-Mexico-Canada Agreement, sometimes characterized as NAFTA 2.0, emerges as a pivotal factor, fostering enhanced trade relations among the US, Mexico, and Canada. Proximity and integrated economies, as well as the challenges in global shipping routes, contribute to Mexico's increasing competitiveness in supply chains, especially in areas like electric vehicle (EV) production.
The Biden administration's trade policy alignment with its predecessor reflects a prevailing skeptisim towards trade. Prioritizing industrial and environmental policies, the administration has achieved significant legislative milestones, including the infrastructure bill, semiconductor bill, and the Inflation Reduction Act. That said, the convergence of trade and environmental policies, particularly in the context of EV production and domestic manufacturing requirements, poses a challenge in realizing the government's multifaceted policy objectives.
Moreover, the ongoing conflicts, such as those in Ukraine and the Middle East, continue to have physical and economic repercussions to global trade. The uncertainty surrounding the upcoming WTO ministerial meeting's ability to forge comprehensive agreements is heightened by challenges ranging from agricultural disputes to disagreements on e-commerce and tariff issues.
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