IfW in the News

The Beginning of the End for Globalization

09.01.2017

Dennis Snower is in worry about the global economy due to Donald Trumps protectionism.

Excerpt from the Article

(...) But at the same time, leading economists around the world are warning against the enormous risks a Trump presidency could pose for the global economy.

Dennis Snower, the president of the Kiel Institute for the World Economy , said he expected Mr. Trump to pursue economic policies strongly driven by protectionism.

As if to confirm this, Mr. Trump began the new year by using Twitter to take aim at the General Motors, threatening to slap import duties on any vehicles they made in Mexico.

"General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A. or pay big border tax!" the president-elect tweeted on January 3.

In an apparent reaction, General Motors' competitor Ford announced that it had scrapped plans to build an assembly plant in Mexico, in an act of anticipatory obedience. Instead, Ford said it would invest the money in its home state Michigan.

Mr. Snower has no illusions about the potential impact of such protectionist measures. Less foreign trade will have "a tangible negative effect on productivity and consumption in the US and around the world," he said.

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