Roberto azevê, former Director General of the World Trade Organization (WTO), is analyzed in Ww This Thursday (27) influence The tariff of cars imposed by Donald Trump in the United States. According to Azevêdo, the results of these measures will only be understood at the end or even after the duration of the current American president.
Trump’s goal is weakness: promoting us responses and encouraging auto companies to settle in American territory, with the aim of creating job opportunities. However, azevêdo notes that this process faces great challenges.
Challenges and doubts
The former director of the World Trade Organization indicates that the maturity of investment in the new American factories may take three to four years, bearing in mind that companies have already taken the manufacturing decision in the country, found the appropriate place and obtained all the necessary licenses.
In addition, Azevêdo emphasizes the uncertainty resulting from these measures: “No one in the United States or anywhere, and the lack of knowledge of the game’s rules.” It is noteworthy that analysts are trying to understand the impact on companies and their measurement, but they find difficulties due to lack of clarity in policies.
The complexity of the tariff
The situation becomes more complicated when considering different commercial agreements and current definitions. Azevêdo cists with the example of Canada, the third largest auto supplier in the United States, where there are questions about the prices that will be applied and how to accumulate with previous measures.
The most extreme cases mentioned are Chinese electric cars, which may face a total rate of 172 %, as a result of the total protectionist measures that have been implemented over time.
Historical alert
Azevêdo is parallel to SMOOOT-HWLY’s law of 1930, which greatly increased the American definitions. He warns that although this law did not cause the great recession, it exacerbated the recession and caused revenge, in just five years, two thirds of world trade disappeared.
The former director of the World Trade Organization expresses his concern about the current scenario, especially given the new definitions scheduled for April 2, whose details are still unknown. He said that this uncertainty could have severe consequences for global trade and the global economy.
