"Protectionism May Intensify in Various Countries in the Future"
There is an analysis that the global economy could be shocked if China, in response to the reciprocal tariff policies of the Donald Trump U.S. administration, disperses the goods it exports to the U.S. to other countries.
Bloomberg News cited Bloomberg Economics analysis on the 7th (local time), forecasting that China is highly likely to divert most of the export markets it loses in the U.S., as during the U.S.-China trade war under Trump’s first term administration.
Even before this tariff war, China has focused on exporting products oversupplied domestically, ranging from high-priced items like electric vehicles to low-priced daily necessities. As President Trump imposed reciprocal tariffs on all trading partners and countries worry about reduced exports to the U.S., Bloomberg observed that if China’s manufacturing expansion pressures the global economy, protectionism in various countries could intensify. The global economy, expected to reach a production scale of $115 trillion this year, is anticipated to be shocked by both the U.S. and China.
According to Bloomberg Economics modeling assuming the implementation of President Trump’s tariff policies and retaliations by trading partners at about half the reciprocal tariff rate, U.S. imports of goods are expected to decrease by 30% by 2030, while China’s exports to the U.S. will plummet by 85%. Additionally, exports to the U.S. from countries such as South Korea and Japan are expected to decline by more than 50%, the European Union (EU) and India by 40%, and the United Kingdom and Brazil by about 15%. On the other hand, imports of Chinese goods by most countries other than the U.S. are projected to increase by less than 5% during the same period.
Economist Richard Baldwin recently stated at an International Monetary Fund (IMF) hosted event, “The ‘U.S. shock’ will lead to a more severe ‘China shock,’” adding, “As a result, other major countries will raise tariffs on China. This is a very likely scenario.”
Albert Park, Chief Economist at the Asian Development Bank (ADB), said that the combined economic shocks from U.S. tariff policies and China’s responses will burden countries caught in the middle, noting that many countries “may find it difficult to absorb more Chinese imports as they are responding to U.S. tariff increases.”
Professor Henry Gao of Singapore Management University pointed out, “President Trump’s tariffs will have an immediate impact. However, in fact, the expansion of China’s manufacturing will have a more severe structural effect,” adding, “Other countries are also likely to respond similarly to the U.S.”
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