Please review the information on current trade dispute at BB

Please review the information on current trade dispute at BBC (below link) and indicate what is your take

https://www.bbc.com/news/business-44324565

Solution

There was a time when the idea of globalization and a borderless world was at it\'s peak. However great powers like US and EU have always used protectionist policies for it\'s own domestic industries. In the recent years with certain political changes all over the world, the idea of protectionist policies is hitting us right in the face.

US imposing tariffs on steel and aluminium from EU and other nations is just a part of the series of protectionist measures taken up by US for so long. So far US propogated free trade for it\'s own benefit, for cheaper products, raw materials,energy products etc. However now the cons of free trade have been causing problems for the US economy. Labour force in US is not cheap . This has resulted in outsourcing of jobs and labour immigration , resulting in employment issues among the nation. Industries also import raw materials from aborad to reduce the cost of production and be more competitive in the international market as they are majorly profit driven.

However due to easy trade, domestic industries also face a lot of competition. EU is a well developed nation and comes neck to neck in technological progress and quality products to the US. This has an adverse impact on dmestic industries whose products do no match the quality and standards of the EU and thus are driven out from the market.

Even though tariffs will protect domestic industries in US it is also going to curb freely competitive markets and might adversly effect US\'s competitiveness in the international markets due to high costs of production.

Moreover retaliation from neighbours in the form of counter tarrifs is justified as this might lead to tariffs wars around the world which will lead us back to a more protected world. This ill surely leave consumers will lesser choices , industries with lesser economies of scale and higher cost of production and prices.