WEBVTT - The World Is Paying for Trump’s China Tariffs

0:00:02.680 --> 0:00:07.200
<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

0:00:08.080 --> 0:00:12.160
<v Speaker 2>One word dominated the economic debate during the US presidential campaign.

0:00:12.360 --> 0:00:16.360
<v Speaker 3>It's tariff. Because tariffs are going to make us rich

0:00:16.400 --> 0:00:18.800
<v Speaker 3>as hell. It's going to bring our countries.

0:00:19.400 --> 0:00:21.720
<v Speaker 1>Business is back that left us.

0:00:21.920 --> 0:00:24.400
<v Speaker 2>While President Trump says those tariffs would be applied to

0:00:24.440 --> 0:00:27.360
<v Speaker 2>countries all over the world, he singled out one of

0:00:27.400 --> 0:00:29.400
<v Speaker 2>them over and over again.

0:00:29.720 --> 0:00:32.800
<v Speaker 3>I put tariffs on China. With China, we took in

0:00:32.920 --> 0:00:34.400
<v Speaker 3>hundreds of billions of dollars.

0:00:34.560 --> 0:00:36.520
<v Speaker 1>Nobody else took in ten cents from China.

0:00:36.600 --> 0:00:40.120
<v Speaker 3>They never did massive tariffs on China. During my four years,

0:00:40.120 --> 0:00:41.480
<v Speaker 3>we had the best economy in the history.

0:00:41.520 --> 0:00:44.680
<v Speaker 2>During his first term in twenty eighteen, Trump embarked on

0:00:44.720 --> 0:00:47.160
<v Speaker 2>a trade war with China in a bid to bring

0:00:47.200 --> 0:00:49.000
<v Speaker 2>manufacturing back to the US.

0:00:49.560 --> 0:00:51.319
<v Speaker 3>Now he's escalating it.

0:00:51.960 --> 0:00:54.320
<v Speaker 2>That may seem like a good opportunity for other nations

0:00:54.320 --> 0:00:57.200
<v Speaker 2>that sell products to the US, but China has not

0:00:57.360 --> 0:01:00.280
<v Speaker 2>let up on manufacturing in the face of Trump's tariff.

0:01:00.640 --> 0:01:03.000
<v Speaker 2>Products that would have gone to the US are now

0:01:03.040 --> 0:01:06.360
<v Speaker 2>flooding into nations all over the world, leading to factory

0:01:06.400 --> 0:01:09.920
<v Speaker 2>closures and mass layoffs. With a new set of sweeping

0:01:09.959 --> 0:01:13.240
<v Speaker 2>global tariffs, set to take effect on April second. That

0:01:13.360 --> 0:01:15.360
<v Speaker 2>pain is likely to increase.

0:01:16.120 --> 0:01:19.399
<v Speaker 1>Every country, even if you don't have tariffs placed directly

0:01:19.440 --> 0:01:21.360
<v Speaker 1>on you, will be impacted in some way.

0:01:21.720 --> 0:01:25.120
<v Speaker 2>Katya Dmitrieva is an economics correspondent for Bloomberg based in

0:01:25.200 --> 0:01:27.920
<v Speaker 2>Hong Kong, and she says, when it comes to China.

0:01:28.080 --> 0:01:31.480
<v Speaker 1>While shipments to places like the US where there are

0:01:31.520 --> 0:01:35.160
<v Speaker 1>higher tariffs have dropped over the past five years, what

0:01:35.200 --> 0:01:37.759
<v Speaker 1>you're seeing is that a bigger part of their trade PIE,

0:01:37.800 --> 0:01:40.120
<v Speaker 1>or a bigger part of their exports PIE, is just

0:01:40.200 --> 0:01:43.919
<v Speaker 1>going to a number of countries all around the world.

0:01:44.560 --> 0:01:47.560
<v Speaker 2>In other words, US tariffs did lead to China selling

0:01:47.600 --> 0:01:52.400
<v Speaker 2>fewer goods to the US, but China's exports didn't suffer overall.

0:01:52.840 --> 0:01:55.320
<v Speaker 2>The things they no longer sold to the US they

0:01:55.320 --> 0:01:58.760
<v Speaker 2>sold to other countries instead. And while some of those

0:01:58.760 --> 0:02:00.880
<v Speaker 2>goods were used in products that were later sold to

0:02:00.960 --> 0:02:05.360
<v Speaker 2>US consumers, many others worked things like clothes and electronics

0:02:05.560 --> 0:02:10.000
<v Speaker 2>that put local manufacturers out of business as consumers opted

0:02:10.000 --> 0:02:11.000
<v Speaker 2>for cheaper items.

0:02:11.520 --> 0:02:15.120
<v Speaker 1>I was speaking with an economist at HSBC, Frederick Newman,

0:02:15.160 --> 0:02:17.239
<v Speaker 1>and he put it this way. It was also in

0:02:17.280 --> 0:02:20.000
<v Speaker 1>one of his research notes. It's an African proverb and

0:02:20.040 --> 0:02:24.120
<v Speaker 1>it goes, when elephants fight, it is the grass that suffers.

0:02:25.560 --> 0:02:29.880
<v Speaker 1>And I think that's a great way of encapsulating exactly

0:02:29.919 --> 0:02:31.880
<v Speaker 1>what we're seeing now and what we're going to be

0:02:31.919 --> 0:02:34.239
<v Speaker 1>seeing for the next few years with tariffs.

0:02:42.560 --> 0:02:44.440
<v Speaker 2>I'm David Gera and this is the big take from

0:02:44.440 --> 0:02:47.760
<v Speaker 2>Bloomberg News Today on the show, how US tariffs on

0:02:47.840 --> 0:02:50.000
<v Speaker 2>China are being shouldered by the rest of the world,

0:02:50.400 --> 0:02:54.080
<v Speaker 2>causing industries in other countries to suffer, and how Trump's

0:02:54.080 --> 0:02:57.760
<v Speaker 2>reciprocal tariffs on April second could make life even harder

0:02:57.880 --> 0:03:06.360
<v Speaker 2>for nations caught in the crossfire. Near the city of

0:03:06.400 --> 0:03:10.440
<v Speaker 2>Surakarta in Indonesia, on the island of Java, a transformation

0:03:10.720 --> 0:03:14.480
<v Speaker 2>has been taking place. The region is Indonesia's textile center,

0:03:14.760 --> 0:03:19.480
<v Speaker 2>known for making elaborate fabrics, but Bloomberg'skati Dimitrieva says in

0:03:19.560 --> 0:03:22.520
<v Speaker 2>recent years that industry has been struggling.

0:03:22.680 --> 0:03:28.280
<v Speaker 1>It's interesting because it feels and it looks a lot

0:03:28.520 --> 0:03:31.639
<v Speaker 1>like the towns that I've seen in the US rust

0:03:31.720 --> 0:03:34.960
<v Speaker 1>belb the Midwest. One of the things you'll notice right

0:03:35.000 --> 0:03:40.440
<v Speaker 1>away is how many factories are closed. They don't have

0:03:40.640 --> 0:03:45.160
<v Speaker 1>a market anymore. Domestically for their goods because people can

0:03:45.240 --> 0:03:48.760
<v Speaker 1>just buy it cheaper in markets and online from China.

0:03:48.880 --> 0:03:53.440
<v Speaker 2>Chinese manufacturers are undercutting Indonesian textile makers and driving them

0:03:53.480 --> 0:03:57.920
<v Speaker 2>out of business. Even Indonesia's trademark Batique textiles aren't safe

0:03:57.960 --> 0:04:02.680
<v Speaker 2>from Chinese competition. When Indonesian producers would try to sell elsewhere,

0:04:02.960 --> 0:04:06.760
<v Speaker 2>they would also compete with these cheaper Chinese goods. How

0:04:06.840 --> 0:04:09.960
<v Speaker 2>much of an outlier is Indonesia? How many other countries

0:04:09.960 --> 0:04:11.720
<v Speaker 2>are kind of wrestling with these same issues.

0:04:12.080 --> 0:04:17.800
<v Speaker 1>Indonesia is not alone. You have Vietnam, Thailand, you have

0:04:18.160 --> 0:04:21.159
<v Speaker 1>even South Korea and Japan, which are developed economies, but

0:04:21.160 --> 0:04:24.360
<v Speaker 1>we've seen them making moves because of the surge in

0:04:24.440 --> 0:04:29.440
<v Speaker 1>Chinese imports. We're seeing it in Mexico and places like

0:04:29.480 --> 0:04:32.200
<v Speaker 1>Turkey as well. So it really does span the globe.

0:04:32.520 --> 0:04:35.159
<v Speaker 2>I was astonished career that China has managed to maintain

0:04:35.200 --> 0:04:37.320
<v Speaker 2>a share of global exports despite a big drop in

0:04:37.360 --> 0:04:40.480
<v Speaker 2>its sheriff total US imports since Trump's first term. How

0:04:40.560 --> 0:04:42.719
<v Speaker 2>is that the case? How given that focus on consumption,

0:04:42.800 --> 0:04:44.239
<v Speaker 2>has that played out in that way?

0:04:44.520 --> 0:04:47.719
<v Speaker 1>So when the tariffs came in twenty eighteen twenty nineteen,

0:04:48.360 --> 0:04:53.200
<v Speaker 1>China immediately pivoted to other markets. So primarily what that's

0:04:53.240 --> 0:04:55.640
<v Speaker 1>meant is emerging markets getting a lot of the same

0:04:55.680 --> 0:04:58.919
<v Speaker 1>goods that normally would have gone to the States, but

0:04:59.000 --> 0:05:02.440
<v Speaker 1>because of high tariffs, demands for those items just dropped.

0:05:02.560 --> 0:05:08.400
<v Speaker 1>And so China's share of exports to places like Vietnam, Indonesia, Thailand,

0:05:09.200 --> 0:05:15.559
<v Speaker 1>Mexico have skyrocketed, while shipments to places like the US

0:05:15.600 --> 0:05:18.440
<v Speaker 1>where there are higher tariffs have dropped over the past

0:05:18.480 --> 0:05:21.880
<v Speaker 1>five years. And so what you're seeing is that a

0:05:21.880 --> 0:05:23.880
<v Speaker 1>bigger part of their trade PIE, or a bigger part

0:05:23.880 --> 0:05:27.159
<v Speaker 1>of their exports PIE is just going to a number

0:05:27.640 --> 0:05:29.400
<v Speaker 1>of countries all around the world.

0:05:29.560 --> 0:05:31.400
<v Speaker 2>What does that look like on the ground in these

0:05:31.440 --> 0:05:34.120
<v Speaker 2>other countries, if China has shifted its attention to them,

0:05:34.720 --> 0:05:37.000
<v Speaker 2>what does it look like when they're exporting so much

0:05:37.480 --> 0:05:38.360
<v Speaker 2>two other countries.

0:05:38.880 --> 0:05:42.160
<v Speaker 1>Well, what it looks like is job loss. It looks

0:05:42.279 --> 0:05:46.320
<v Speaker 1>like anger, and once that factory closes, I mean that

0:05:46.560 --> 0:05:50.280
<v Speaker 1>city is at risk. And that's exactly what we saw

0:05:50.279 --> 0:05:52.880
<v Speaker 1>in the States. It's exactly what we're seeing now across

0:05:52.960 --> 0:05:56.279
<v Speaker 1>emerging markets. And it's not just workers, of course, it's

0:05:56.279 --> 0:06:02.160
<v Speaker 1>also retailers. It's also local indu street executives and companies

0:06:02.200 --> 0:06:03.320
<v Speaker 1>that are feeling the pain of this.

0:06:03.960 --> 0:06:08.280
<v Speaker 2>When we talk about Chinese exports, are we talking about electronics, principolice?

0:06:08.760 --> 0:06:08.800
<v Speaker 4>What?

0:06:09.720 --> 0:06:11.839
<v Speaker 3>What? In some is China exporting to the world.

0:06:12.440 --> 0:06:17.800
<v Speaker 1>So it started with steel. So they began exporting a

0:06:17.839 --> 0:06:23.240
<v Speaker 1>few years ago, record amounts of steel to economies like Mexico,

0:06:23.400 --> 0:06:27.239
<v Speaker 1>like Brazil, as well as Southeast Asia. But something we've

0:06:27.240 --> 0:06:31.040
<v Speaker 1>noticed is that it's actually become much bigger than that.

0:06:31.120 --> 0:06:34.280
<v Speaker 1>It's not just steel anymore. It's not just evs, you know,

0:06:34.600 --> 0:06:38.680
<v Speaker 1>it's not just renewable goods. It's not just batteries. It's everything.

0:06:38.920 --> 0:06:43.120
<v Speaker 1>It's everything from steel to shoes to calculators.

0:06:43.760 --> 0:06:47.240
<v Speaker 2>Economists are calling this a new China Shock, a term

0:06:47.279 --> 0:06:50.440
<v Speaker 2>first used to describe the dramatic impact Chinese exports had

0:06:50.640 --> 0:06:53.800
<v Speaker 2>on the US labor market starting in the late nineteen nineties.

0:06:54.520 --> 0:06:58.120
<v Speaker 2>This time the shock is more global. But China's big

0:06:58.160 --> 0:07:02.520
<v Speaker 2>export push is not without say domestic cost. While exports

0:07:02.520 --> 0:07:04.960
<v Speaker 2>have buoyed the economy as the government seeks to deflate

0:07:05.000 --> 0:07:08.360
<v Speaker 2>a property bubble, Trump's tariffs are forcing authorities to now

0:07:08.480 --> 0:07:11.640
<v Speaker 2>ramp up consumer spending to diversify the economy.

0:07:12.080 --> 0:07:14.480
<v Speaker 1>Yeah, this is This is kind of the big question

0:07:14.960 --> 0:07:18.960
<v Speaker 1>for China right now. You can see that the government

0:07:19.400 --> 0:07:22.880
<v Speaker 1>policy makers in China and twenty twenty five have really

0:07:22.880 --> 0:07:27.200
<v Speaker 1>made consumption and pivoting to local consumption a big priority

0:07:27.280 --> 0:07:31.320
<v Speaker 1>exactly because of this. It's a reaction to tariffs, to

0:07:31.400 --> 0:07:36.200
<v Speaker 1>Trump's tariffs, and it's also an acknowledgement that China cannot

0:07:36.240 --> 0:07:39.360
<v Speaker 1>simply rely on exports forever to fuel growth. They really

0:07:39.440 --> 0:07:43.160
<v Speaker 1>need to pivot at some point, something economists and countries

0:07:43.160 --> 0:07:45.600
<v Speaker 1>around the world have been saying for years now. The

0:07:45.640 --> 0:07:48.600
<v Speaker 1>first set of tariffs that came in in twenty eighteen

0:07:48.640 --> 0:07:52.240
<v Speaker 1>twenty nineteen was one of the things that prompted this

0:07:52.400 --> 0:07:55.520
<v Speaker 1>China shock that we're now seeing globally. One thing that

0:07:55.640 --> 0:07:59.520
<v Speaker 1>Chinese policymakers need to think about now is not just

0:07:59.840 --> 0:08:03.400
<v Speaker 1>you West tariffs, but also tariffs from their neighbors and

0:08:03.440 --> 0:08:06.200
<v Speaker 1>their allies and markets where they thought that it was

0:08:06.240 --> 0:08:08.880
<v Speaker 1>pretty safe to start selling goods.

0:08:10.120 --> 0:08:11.280
<v Speaker 3>Coming up after the break.

0:08:11.440 --> 0:08:14.320
<v Speaker 2>The tactics countries are using to fight back against the

0:08:14.360 --> 0:08:17.960
<v Speaker 2>global China shock, and how Trump's reciprocal tariffs could put

0:08:18.000 --> 0:08:19.080
<v Speaker 2>those countries in.

0:08:19.000 --> 0:08:20.520
<v Speaker 3>An even more difficult situation.

0:08:31.040 --> 0:08:33.560
<v Speaker 2>The tariff's President Trump put in place on China during

0:08:33.559 --> 0:08:37.439
<v Speaker 2>his first term, redirected a flood of cheap Chinese exports

0:08:37.440 --> 0:08:40.960
<v Speaker 2>from the US to other countries around the world. In

0:08:41.040 --> 0:08:44.559
<v Speaker 2>his second term, his administration has already raised tariffs by

0:08:44.600 --> 0:08:49.040
<v Speaker 2>twenty percent and has threatened further increases. Those tariffs risk

0:08:49.120 --> 0:08:52.160
<v Speaker 2>sending more cheap Chinese goods and materials around the world,

0:08:52.400 --> 0:08:56.120
<v Speaker 2>making it hard for other countries to compete. Bloomberg' Katie

0:08:56.160 --> 0:08:59.680
<v Speaker 2>Dimitrieva says, those other countries are trying to figure out

0:08:59.679 --> 0:09:03.840
<v Speaker 2>how that can defend themselves. Broadly speaking, what can these

0:09:03.840 --> 0:09:07.600
<v Speaker 2>countries do to prevent this influx of goods from coming in?

0:09:08.559 --> 0:09:11.360
<v Speaker 2>Stand up to China? Is it tariffs? This is a

0:09:11.440 --> 0:09:14.400
<v Speaker 2>reciprocal tariffs, Is it a value added tax? Is it

0:09:15.000 --> 0:09:17.679
<v Speaker 2>kind of investigations into dumping of materials? Of how are

0:09:17.679 --> 0:09:21.240
<v Speaker 2>they approaching this kind of change in the economic landscape.

0:09:21.400 --> 0:09:24.760
<v Speaker 1>Yeah, it's all the above. Several months ago across Southeast Asia,

0:09:24.960 --> 0:09:29.320
<v Speaker 1>countries were starting to push back on China and these

0:09:29.400 --> 0:09:34.800
<v Speaker 1>cheap exports. And it was interesting because we had already

0:09:34.920 --> 0:09:38.800
<v Speaker 1>seen developed economies like the US and Europe atting tariffs,

0:09:39.120 --> 0:09:42.240
<v Speaker 1>but it was very different that Southeast Asia, which is

0:09:42.360 --> 0:09:47.199
<v Speaker 1>arguably politically geographically much closer to China, began pushing back

0:09:47.240 --> 0:09:48.079
<v Speaker 1>as well.

0:09:48.120 --> 0:09:51.400
<v Speaker 2>Thailand has a seven percent value added tax on imported

0:09:51.400 --> 0:09:54.480
<v Speaker 2>goods below fifty dollars and launched a probe into Temu,

0:09:54.679 --> 0:09:58.240
<v Speaker 2>China's e commerce giant. Malaysia has its own ten percent

0:09:58.280 --> 0:10:01.559
<v Speaker 2>sales tax on low value goods, and Vietnam last year

0:10:01.679 --> 0:10:04.720
<v Speaker 2>ordered Temu and Shen, a similar e commerce site, to

0:10:04.760 --> 0:10:09.040
<v Speaker 2>suspend operations in the country. Indian authorities have launched investigations

0:10:09.040 --> 0:10:13.080
<v Speaker 2>into Chinese dumping, and a little further abroad, Mexico is

0:10:13.080 --> 0:10:16.840
<v Speaker 2>reviewing its own tariffs on Chinese shipments. Indonesia considered a

0:10:16.920 --> 0:10:19.840
<v Speaker 2>two hundred percent tariff on a range of Chinese goods

0:10:19.920 --> 0:10:23.640
<v Speaker 2>last year, but fighting back against China carries risks.

0:10:24.240 --> 0:10:29.880
<v Speaker 1>It's interesting because these countries are kind of squeezed right,

0:10:30.559 --> 0:10:34.920
<v Speaker 1>like they want to maintain good relations with China. And

0:10:34.960 --> 0:10:38.040
<v Speaker 1>this is why the situation is a bit unprecedented in

0:10:38.080 --> 0:10:43.800
<v Speaker 1>that places like Indonesia, the leadership wants to maintain good

0:10:44.040 --> 0:10:47.880
<v Speaker 1>geopolitical relations because they rely a lot on Chinese FDI

0:10:48.320 --> 0:10:50.920
<v Speaker 1>as part of the Belton Roade initiative and also just

0:10:51.000 --> 0:10:51.880
<v Speaker 1>general investment.

0:10:52.320 --> 0:10:55.200
<v Speaker 3>FDI stands for foreign direct investment.

0:10:55.040 --> 0:10:57.560
<v Speaker 1>So it's not in their best interest, in fact, to

0:10:57.640 --> 0:11:00.640
<v Speaker 1>take the kinds of steps that President Trump taken in

0:11:00.679 --> 0:11:04.240
<v Speaker 1>the US. So what they've been left to do is

0:11:04.320 --> 0:11:08.439
<v Speaker 1>float these very specific tariffs for industries that are the

0:11:08.480 --> 0:11:09.120
<v Speaker 1>most vocal.

0:11:09.559 --> 0:11:13.079
<v Speaker 2>What is China say in reply to criticism that these

0:11:13.080 --> 0:11:16.800
<v Speaker 2>other economies are being flooded, that they're facing economic difficulty

0:11:17.000 --> 0:11:19.199
<v Speaker 2>because of this. What's China's response been.

0:11:19.720 --> 0:11:25.880
<v Speaker 1>China has been very quiet about this particular subject. In fact,

0:11:26.120 --> 0:11:31.199
<v Speaker 1>a reporter at a Chinese Foreign Ministry briefing earlier this month,

0:11:31.320 --> 0:11:35.480
<v Speaker 1>a reporter from Pakistan and from Pakistani news outlet asked

0:11:35.600 --> 0:11:38.880
<v Speaker 1>about this exact question, this flood of Chinese goods in

0:11:38.880 --> 0:11:42.560
<v Speaker 1>neighboring countries, and the response was interesting.

0:11:42.960 --> 0:11:46.720
<v Speaker 2>Here's that exchange, shared on YouTube by China's CCTV Video

0:11:46.800 --> 0:11:47.520
<v Speaker 2>news agency.

0:11:47.640 --> 0:11:53.400
<v Speaker 4>Today's China is an anchor of stability, engine of economic development,

0:11:54.000 --> 0:11:58.440
<v Speaker 4>and a pillar of regional security. Indust's that it is

0:11:58.480 --> 0:12:00.800
<v Speaker 4>common for neighbors to not agree on everything.

0:12:01.120 --> 0:12:04.640
<v Speaker 1>China's top diplomat basically said, you know, it's common for

0:12:04.679 --> 0:12:08.600
<v Speaker 1>neighbors not to agree on everything. What we noticed afterwards, though,

0:12:08.640 --> 0:12:11.600
<v Speaker 1>is that they scrubbed the question from the official record,

0:12:12.040 --> 0:12:15.640
<v Speaker 1>so it's a subject that is kind of sensitive enough

0:12:16.000 --> 0:12:20.000
<v Speaker 1>that it gets policymakers to react in that way and

0:12:20.120 --> 0:12:21.520
<v Speaker 1>kind of make them nervous.

0:12:21.920 --> 0:12:25.160
<v Speaker 2>There are potentially more US tariffs in the works, meaning

0:12:25.240 --> 0:12:28.199
<v Speaker 2>nations already dealing with the China shock are now scrambling

0:12:28.240 --> 0:12:30.800
<v Speaker 2>to prepare for these extra trade barriers with the US.

0:12:31.520 --> 0:12:34.400
<v Speaker 2>President Trump has said on April second, he's going to

0:12:34.400 --> 0:12:38.520
<v Speaker 2>implement what the administration is calling reciprocal tariffs. Each one

0:12:38.559 --> 0:12:40.720
<v Speaker 2>of the US's trade partners would be hit with a

0:12:40.760 --> 0:12:44.320
<v Speaker 2>tariff rate calculated by taking into account the barriers the

0:12:44.440 --> 0:12:47.640
<v Speaker 2>US faces to trading with that country, and that means

0:12:47.679 --> 0:12:50.560
<v Speaker 2>these nations industries will face pressure not just from cheap

0:12:50.640 --> 0:12:54.640
<v Speaker 2>Chinese imports, but also potentially less demand from the US

0:12:55.080 --> 0:12:56.640
<v Speaker 2>Among their largest trade partners.

0:12:56.880 --> 0:12:59.280
<v Speaker 1>They are trying as much as possible to get Trump

0:12:59.400 --> 0:13:03.680
<v Speaker 1>an official on the phone with a varied success rate.

0:13:04.240 --> 0:13:09.079
<v Speaker 1>They're trying to buy as many US goods or make

0:13:09.160 --> 0:13:13.079
<v Speaker 1>promises to buy as many US goods as possible, particularly.

0:13:12.600 --> 0:13:15.160
<v Speaker 3>LNG that's liquefied natural gas.

0:13:15.679 --> 0:13:20.080
<v Speaker 1>So you're seeing global leaders coming to the White House

0:13:20.320 --> 0:13:23.320
<v Speaker 1>or releasing statements saying we're open to buy more LNG

0:13:23.559 --> 0:13:26.200
<v Speaker 1>and more goods from the US to sort of shrink

0:13:26.240 --> 0:13:29.319
<v Speaker 1>the trade surplus that some countries have with the US.

0:13:29.320 --> 0:13:31.960
<v Speaker 1>That many countries have with the US because the US

0:13:32.000 --> 0:13:35.599
<v Speaker 1>is the world's biggest economies with the most hungry consumers,

0:13:36.120 --> 0:13:40.520
<v Speaker 1>and so there's communication, trying to negotiate, trying to make

0:13:40.559 --> 0:13:44.439
<v Speaker 1>promises to buy more things. That's been the big step

0:13:44.559 --> 0:13:49.280
<v Speaker 1>so far. And industries are preparing for a flood, a

0:13:49.400 --> 0:13:52.040
<v Speaker 1>renewed flood of goods hitting their shores.

0:13:53.440 --> 0:13:56.520
<v Speaker 2>Is the playbook fundamentally the same. Are we likely to

0:13:56.520 --> 0:13:59.080
<v Speaker 2>see sort of what happened during the first Trump term

0:13:59.240 --> 0:14:02.760
<v Speaker 2>happen again in countries like Indonesia, Thailand, Vietnam.

0:14:03.280 --> 0:14:07.480
<v Speaker 1>Yeah, it really depends on what the reciprocal tariffs look

0:14:07.600 --> 0:14:13.120
<v Speaker 1>like right now. We don't know what the administration is

0:14:13.200 --> 0:14:17.400
<v Speaker 1>looking at in terms of the number, you know, will

0:14:17.400 --> 0:14:21.280
<v Speaker 1>it be a tiered system, Will every country get its

0:14:21.360 --> 0:14:24.880
<v Speaker 1>own rate, Will there even be a rate that's announced,

0:14:24.920 --> 0:14:28.160
<v Speaker 1>Will there be carveouts, will there be caveats, will there

0:14:28.200 --> 0:14:30.680
<v Speaker 1>be space for other industries? This is what all of

0:14:30.720 --> 0:14:34.880
<v Speaker 1>these industries across the world right now, especially the biggest

0:14:34.880 --> 0:14:37.680
<v Speaker 1>trading for US's biggest trading partners, they're trying to negotiate

0:14:37.720 --> 0:14:41.760
<v Speaker 1>that right now not looking very hopeful. So you know,

0:14:41.800 --> 0:14:44.680
<v Speaker 1>what we could see is in some ways a repeat

0:14:44.960 --> 0:14:48.680
<v Speaker 1>of the first Trump trade war, where you have just

0:14:48.880 --> 0:14:53.440
<v Speaker 1>rapid fire developments, especially in the first year, you have

0:14:53.560 --> 0:14:56.920
<v Speaker 1>the tariffs come in. Similar to what happened in the

0:14:56.920 --> 0:14:59.800
<v Speaker 1>first term, tariffs on China did come in, but over

0:15:00.080 --> 0:15:03.520
<v Speaker 1>period of a year of negotiations, additional tariffs were not

0:15:03.960 --> 0:15:07.320
<v Speaker 1>put in place, and so you know the timeframe of

0:15:07.360 --> 0:15:11.680
<v Speaker 1>this happening. In some ways, it just gets kind of elongated,

0:15:11.720 --> 0:15:13.000
<v Speaker 1>so we could be in for a bit of a

0:15:13.040 --> 0:15:17.080
<v Speaker 1>wait before you know everything the dust is settled. In

0:15:17.080 --> 0:15:19.200
<v Speaker 1>some ways, it will be very different, though, I mean

0:15:19.280 --> 0:15:22.960
<v Speaker 1>the main difference is that Trump's trade war has gone global,

0:15:23.280 --> 0:15:26.360
<v Speaker 1>and so every country, even if you don't have tariffs

0:15:26.400 --> 0:15:30.480
<v Speaker 1>placed directly on you, will be impacted in some way.

0:15:34.080 --> 0:15:36.600
<v Speaker 2>This is the big take from Bloomberg News. I'm David Gera.

0:15:37.000 --> 0:15:40.200
<v Speaker 2>This episode was produced by Alex Tie. It was edited

0:15:40.200 --> 0:15:43.400
<v Speaker 2>by Tracy Samuelson and Daniel ten Kate. It was fact

0:15:43.480 --> 0:15:46.160
<v Speaker 2>checked by Adrian A. Tapia and mixed and sound designed

0:15:46.160 --> 0:15:49.760
<v Speaker 2>by Alex Segura. Our senior producer is Naomi Shaven. Our

0:15:49.800 --> 0:15:53.960
<v Speaker 2>senior editor is Elizabeth Ponso. Our executive producer is Nicole Beamster.

0:15:54.040 --> 0:15:56.920
<v Speaker 2>Bor Sage Bauman is Bloomberg's head of podcasts.

0:15:57.480 --> 0:15:58.160
<v Speaker 3>If you liked this.

0:15:58.160 --> 0:16:00.640
<v Speaker 2>Episode, make sure to subscribe and review you The Big Take.

0:16:00.680 --> 0:16:03.400
<v Speaker 2>Wherever you listen to podcasts, it helps people find the show.

0:16:04.040 --> 0:16:06.000
<v Speaker 2>Thanks for listening. We'll be back tomorrow