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Economy

From Policy to Populism: Donald Trump’s Trade Policy in Global Context

Image courtesy of The White House/Flickr.

This article was originally published by the Elcano Royal Institute on 10 April 2018.

Theme

An open multilateral trade system is under direct challenge from the policies of President Donald Trump. The year 2018 will be crucial.

Summary

This paper reviews US trade policy one year on after the election of Donald Trump. It demonstrates that after a year of exacerbating transactionalist and protectionist rhetoric we are now in a position to observe the direction policy is taking in practice. Sadly, it is becoming clear that practice is indeed matching rhetoric. The evidence is gathering. Commencing with withdrawal from the TPP, policy has hardened towards an open multilateral system. The year 2018 has seen attacks on the WTO (stopping appointments to the Appellate Board), followed by moves to introduce tariffs on white goods, aluminium and steel and a strategy for direct activity towards China. The year will also see a hard line towards NAFTA re-negotiations. The prospects of enhanced trade tension –trade war, even– is the obvious next stage flowing from Trump’s policy. Major players are likely to retaliate.