US President Donald Trump Customs policy has dominated the world’s titles in recent days. New twists and turns follow each other at a rapid pace, and the setting changes day after day.
Trump ordered import duties for Canada and Mexico this weekend, but postponed them on Monday. Again, anti -Chinese duties came into force on Tuesday, and China set up new ones. The European Union is preparing for the threat of customs and difficult negotiations.
Underneath the EPN, a tight outstanding is what the situation is right now.
What kind of duties are now valid?
US import duties to China have entered into force today on Tuesday.
The duties are ten percent. They apply to all Chinese products imported to the United States.
Trump had already ordered some Chinese products in his last season. His followers Joe Biden Keep them in effect and even lifted some of them.
How has China responded?
China placed its own customs on US products and restricted the export of raw materials to the United States.
China set 15 percent import duties on US coal and liquid natural gas. In addition, it set ten percent duties for crude oil, agricultural machines and cars with high power engines. Chinese duties will take effect next Monday.
China also decided to restrict the export of critical raw materials such as Volfram, Teluur and molybde to the United States. These raw materials are needed to produce advanced information technology.
China also began an investigation into whether Google is misused its dominant position.
The effects of Chinese customs are estimated to be relatively small. For example, the United States does not take much natural gas or cars to China.
Who pays duties?
Import duties end up paying companies and consumers in their country.
Import duties are paid by companies that bring products to the country. They transfer costs to their customers, which will increase the prices of foreign products. The US import duties thus suffer from the United States and Chinese import duties.
Export countries also experience losses as their exports are reduced. The majority of economists consider duties to the economy.
Trump himself believes that duties will increase industrial production and thus jobs in the United States.
Which duties were postponed?
Trump decided to postpone 25 % import duties for Canada and Mexico by month.
Both countries promised to strengthen control at the US border, as Trump had demanded. The countries had also threatened the United States with new ones.
Trump had justified the duties on the fact that these countries were flowing fentanyylum and migrants illegally into the United States. The accusation of Mexico is true, but the amount of migration and drugs from Canada are very small.
The United States, Mexico and Canada form a free trade area, so duties would have been extensively interrupted by the customs chains. This would have undermined the economy of all countries.
Are European customs coming for Europe?
Trump has said he will soon decide on import duties for the European Union.
He has not yet told about his intentions. On the other hand, according to Trump, the British duties that have resigned from the EU are not necessarily coming.
Trump has complained that the EU is not buying “much” from the United States. In reality, the United States is the EU’s second largest importer.
What is the EU going to do?
Leaders of EU countries have warned that the EU will respond to the duties as needed.
Chairman of the European Commission Ursula von der Leyen has said that the EU is ready for hard negotiations but is looking for joint solutions with the United States.
One solution could be that EU countries promise to buy more liquefied natural gas and weapons from the United States, a senior researcher at the Institute for International Affairs Niklas Helwig Evaluate to STT.
How does the trade war affect Finland?
The duties and the uncertainty they cause threaten to weaken the Finnish economy.
If the United States places duties on the EU, it will also make Finnish products more expensive in the United States.
According to Nordea’s estimate Finland’s gross domestic product would be reduced by 0.2 % if the United States would impose a 10 % duties on the EU and the export would be reduced to the same amount. The effect may be smaller if the euro becomes cheap in relation to the dollar.
Customs also act indirectly.
US customs duties in China can cause Chinese companies to compete more strongly in Europe when exports to the United States are no longer pulling. This may know difficulties for Finnish companies.
Customs and newcomers reduce world trade and cause uncertainty. It weakens the economy everywhere, including in Finland.
On Tuesday morning, European stock prices were falling in the aftermath of trade disputes.
Sources: Reuters, AFP, AP, STT