Global trade war possible if Trump slaps tariffs on auto industry, says expert

ABS-CBN News

Posted at Jun 12 2019 07:40 PM

Watch also in iWant or TFC.tv

An international trade expert warned that US threats to impose tariffs on the global automotive industry could worsen that trade war that would rope in other large economies.

Hinrich Foundation research fellow Stephen Olson said the sheer size alone of the industry, the third biggest trade category in the world, means tariffs would be immensely disruptive.

"You can fully expect the auto-exporting countries to place retaliatory tariffs on products from the US. And then we run the risk of really heading down that slippery slope," Olson said in an exclusive interview with ANC's "Market Edge."

Countries such as Japan, Germany, South Korea, the UK, Mexico and Canada, which have large automotive industries, would get embroiled. 

Olson added that, while China is not a major exporter of finished vehicles to the US, it manufactures auto parts that will also be caught in the possible tariff war, further complicating the already tense trade relations between the two economic powerhouses.