The WB expects the global economy to contract for the first time since WWII in 2009 and world trade is to decline to the lowest level in 80 years.
A trade dispute has just exploded between Washington and Beijing following the imposition of tariffs on Chinese tires imported into the US.
China’s internet community has gone viral on the topic. And many in the West are thinking. “Isn’t this type of reaction a bit out of date? Given China’s economic power, if they want to sell tires in another country, they can just go ahead and buy a tire manufacturer there. The West has enough broke businesses.”
With the G20 summit opening tomorrow in Pittsburgh, people are wondering what kind of world the aftermath of the financial crisis is likely to produce in the years to come.
The tendency, as we have seen, is to go tribal.
Forbes is heralding the end of Thomas Friedman’s ”Flat World” and the beginning of a new “era of decreasing trade”.
I can’t help sensing a strong feeling of hysteria around the whole thing.
Yes, the world is changing. May be much faster than Friedman or anybody else had predicted. But the answer is not to find refuge in protectionism.
Times call for much more creative solutions. Let’s see what comes out of tomorrow and Friday.
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