Trump's $ 7.5 billion victory could cost trillions

3. October, Donald Donald Trump tweeted "The United States won a $ 7.5 billion grant from the World Trade Organization against the European Union, which has for many years treated the United States very badly on trade because of tariffs, trade barriers and more. This case has been going on for years

Trump referred to the World Trade Organization (WTO) decision on Airbus October 2, the WTO stated that the EU subsidized Airbus, which does not conform to WTO principles, which has affected Boeing's (BA) aviation market over the past 1[ads1]5 years, the United Kingdom, Germany, France and Spain were the main providers of these subsidies to Airbus.

  Trump & # 8217; s $ 7.5 billion victory could cost trillions of "src =" https://marketrealist.imgix. net / uploads / 2019/10 / AdobeStock_199320438.jpeg? w = 587 & h = auto & fit = max & auto = format "title =" Trump & # 8217; s $ 7.5 Billion Victory Can Cost Trillion "/> [19659005] Trump's new trade war </span></h2>
<p>  According to the October 2 statement from the Office of the United States Trade Representative (or USTR), "<span> The United States has today requested that the WTO schedule a meeting on October 14 to approve a US request for authorization to take countermeasures against the EU." [19659002] Specifically, the EU may do not retaliate as China for WTO-approved countermeasures, and the EU cannot appeal. The Trump administration is authorized to impose tariffs up to 100% for "affected products" at any time. to impose a 10% duty rate on civil aircraft Agricultural and other products would be subject to a 25% duty. </span></p>
<p><span data-preserver-spaces= Plus, Trump seems to have opened a new front in the tariff war. In a tweet on September 3 he warned the EU of unfair trade practices. The timing of this decision could have a negative impact on the world economy, and business investment decisions could be affected worldwide.

According to IHS Markit data, real world GDP could be reduced by 0.8% and 1.4% in 2019 and 2020, respectively. In addition, this model assumes a "protectionism scenario." Nominal GDP terms, this decline could be worth over a trillion dollars.

US-EU Trade Details

In 2018, total US-EU trade was $ 1.3 trillion. In addition, the trade deficit for the past year was $ 109 billion. US top exports to the EU included aircraft, machinery, oil and optical and medical instruments. Total exports in these categories were $ 46.5 billion, $ 34.2 billion, $ 28.5 billion, and $ 27.7 billion, respectively. The EU is thus a very important market for Boeing, and the WTO's ruling can benefit Boees share price.

Moreover, US agricultural exports to the EU were $ 13.5 billion, as the EU is the third largest market for American farmers. In 2018, US exports to the EU increased 9.2%. Also, US exports of goods and services to the EU represented 2.5 million workers in 2015.

Last year, EU exports to the US grew by 9.1%. Germany exported goods worth nearly $ 125.9 billion. UK, France and Italy exports to the US were $ 60.8 billion, $ 54.7 billion and $ 52.5 billion, respectively. Machines, pharmaceuticals and vehicles are the main product categories for this export. The trading value of these categories was $ 80.2 billion, $ 71.9 billion and $ 56.4 billion, respectively.

The EU is a more important market for Boeing than the US is for Airbus (EADSY), based on trade flow data. Based on car import figures, US carmakers like General Motors and Ford could see their stock prices respond to Trump's new customs war against the EU.

Trump and Europe

October 10, trade representatives plan to meet in Washington, DC, for US-China trade talks. Reportedly, Trump is optimistic about trade talks. However, Larry Kudlow, director of the National Economic Council, is not sure about the deal. Kudlow believes that years could pass before a resolution can be reached.

In addition, Trump's aggressive policies against China could further dampen this growth rate. The White House is investigating various alternatives, including an investment scheme in China.

In the second quarter of 2019, Germany's GDP fell by 0.1%, pushed by the US-China trade war. Germany is the largest economy in the EU. On September 6, German Chancellor Angela Merkel noted during a two-day visit to China, "We hope there will be a solution in the trade dispute with the United States since it affects everyone."

Source link

Back to top button