The Global Trade Alert sure has great timing. Less than a week ago, the Obama Administration announced a 35% tariff hike on tire imports from China. Apparently, the United States is not the only country pushing for protectionism. Now the GTA, a group of trade experts with backing from the World Bank, has found 130 new measures to restrict trade worldwide, according to the Wall Street Journal.
It is no secret that global trade is hurting—it is expected to shrink 10% in the next year. If these restrictive measures take effect however, that number will get much worse. Both world powers and developing economies are using a myriad of tactics to strangle international exchange. Fifty-five countries have already passed measures aimed at hurting Chinese exports, while forty-nine have enacted similar restrictions on the United States. Almost fifty new barriers each have been proposed on automobiles and agricultural products.
Last week, a Wall Street Journal opinion piece warned of creeping protectionism in the coming months, and the GTA report only confirms those fears. At the G20 Summit in April, Obama asserted that “We have to reject protectionism and accelerate our efforts to support emerging markets.” In light of recent tariffs however, it would appear that the President is more likely to embrace protectionism than reject it. A tariff on Chinese tires is myopic, counterproductive trade policy, but it looks like such measures could soon become the norm. Get nervous…