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Donald Trump once again dominated the headlines last week. After refusing to sign a common statement of intentions with other leaders at the G7 summit, he went on to insult Canadian Prime minister Justin Trudeau via his favorite means of communication (Twitter), imposed trade tariffs on Chinese imports and raised the prospect of imposing tariffs on European car imports should Europe not remove its trade barriers against US imports.
For all his flaws as President of the United States, Donald Trump is however correct in addressing the issue of trade policies:
Nevertheless, Trump’s methods are wrong. As many military historians will be eager to point out, there is a danger in fighting on too many fronts simultaneously. It would be better if Trump chose his battles by order of priority and rallied other Western leaders to win the most important one: improving access to the Chinese economy and creating a “level playing field” with China.
All the other trade discussions with Canada, Mexico and the EU play a subordinated role compared to the one with China and can therefore be held at a later stage. By isolating himself from other G7 leaders, Trump is only weakening his negotiation position versus China. It is time to reassess this strategy.
The CIO weekly thoughts focus and reflect on key topics, which caught Lars Kalbreier's mind during the week. It is more a free expression of thoughts to trigger healthy debates amongst the readership and by no means intended to be a strategy review.