Joe Biden (Democratic Party) was selected as US president in November 2020. U.S economy has been stagnant since the emergence of COVID-19, which diminished purchase power of overseas supplies. However, if the US economy recovers as economic stimulus measures reach agreement, the demand from U.S. consumers will increase, which is good news for global economy and trade. Nevertheless, due to the increase in monetary base and the velocity of dollar supply, it is highly likely that Biden's major pledges will act as a pressure to appreciate other currencies (only Turkish Lira is depreciating its value). There is also high possibility that Biden will maintain a strong policy toward China to protect U.S. industries, which is in need for other countries to monitor and prepare.
Dealing with China
Similar to the previous Trump administration's trade policy, Biden administration will also show strong stance towards China in terms of trade through strengthening solidarity with the alliance. It is expected to respond strongly to unfair trade practices in China in collaboration with allies and expand to areas such as human rights, labor, and the environment (climate change).
Protective Trade Measures
The possibility of withdrawing tariffs against China and Article 232 measures imposed by the Trump administration is expected to be low, and import regulatory measures such as anti-dumping and countervailing duties are expected to continue to protect domestic industries.
Trade Agreement
It is a position that it will not proceed with a new trade agreement immediately after election, and even if a trade agreement is promoted, there is a high possibility that the Democratic Party will demand strengthening of requirements such as labor and environment provisions traditionally emphasized.
These three factors are the position that the United States will lead the world trade order and rebuild the leadership of the United States through multilateralism and restoration of trust with allies.
How will these affect to the global trade? The recovery of the US economy through expansion of stimulus package and rules-based trade policy are expected to have a positive effect on global trade, but there is a need for continuous monitoring of disputes between the US and China and fluctuations in exchange rates and oil prices, and protective trade measures (Buy American).
To conclude the existing concept of US-China conflict remain unchanged. Unlike Trump's unpredictable and extreme tariff wars, trade policy with China is likely to become an imprisonment for China through coalitions with allies. Therefore, the trade dependent country like Japan, Korea and Taiwan should pay close attention to Biden's economic pledges and the process of industrial protection policies.
댓글 없음:
댓글 쓰기