This year, the IMF expects 70 percent of the global economy to experience a slowdown.
IMF Managing Director Christine Lagarde speaks at the U.S. Chamber of Commerce in Washington, D.C., on Tuesday. By Heather Long Heather Long Economics correspondent Email Bio Follow April 3 at 10:28 AM The International Monetary Fund calls this a “delicate moment” for the global economy as many countries are in the midst of a slowdown. Resolving President Trump’s trade war and Brexit could go a long way toward preventing a deeper slowdown, the IMF said.
In new research released Wednesday, the IMF found that focusing on bilateral trade deficits, as Trump has done with China, is useless because erecting trade barriers against one country such as China typically results in the United States importing more from other nations. It is also a drag on global growth as businesses have to figure out new supply chains, and countries that are not as adept at producing products have to beef up production.
Trump has repeatedly said he is using tariffs as a negotiating tool to get China to agree to stop stealing U.S. intellectual property and stop subsidizing so many industries. Top Chinese officials are in the United States this week for further trade talks, although it’s unclear if the two countries will be able to come to an agreement.
Trump has put hefty tariffs on nearly 15 percent of all U.S. imports. Calls are growing for Trump to remove tariffs on steel and aluminum imports, which are causing costs to rise for many automakers and companies that use those metals to manufacture finished products in the United States. The Aluminum Association, which represents many companies that use aluminum, urged Trump to remove the metal tariffs Wednesday, a message that has been echoed by many Republicans in Congress.
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