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Examining the Shift in America’s Trade Policy: A Move Towards Protectionism

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Examining the Shift in America’s Trade Policy: A Move Towards Protectionism

by Geraldine S.
12/26/2022
in Global Trade, Trade Policies

The landscape of international trade has seen significant developments in recent years, with notable shifts in trade policies by major global players. Among these, the United States has demonstrated a change in its approach, moving towards more protective measures. This shift marks a contrast from the established norms of liberal, globalized trade that have been a foundation of international relations and economic strategy since World War II.

Post-World War II, the global political and economic landscape focused on fostering political, economic, and social interdependence as a means to prevent future conflicts. This approach led to the creation of institutions like the European Union, initially based on the Coal and Steel Community, with the aim of creating mutual reliance to such an extent that war would become disadvantageous for all involved.

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Simultaneously, the General Agreement on Tariffs and Trade (GATT) was established in 1947, under the leadership of US President Franklin Roosevelt. GATT laid the groundwork for guiding trade among market economies, aiming to boost economic recovery in the post-war era. Evolving through the years, GATT’s principles were eventually integrated into the World Trade Organization (WTO) in 1994, which aimed to regulate and facilitate a multilateral trading system.

However, recent developments in U.S. trade policy have signaled a deviation from this long-standing commitment to free trade. The administration of President Donald Trump marked a notable shift with the imposition of Section 301 tariffs on China, citing national security concerns, and Section 232 tariffs on steel and aluminum imports from various countries, including U.S. allies. These measures were framed as efforts to protect and rejuvenate American industries.

Although some of these policies were reversed, the subsequent administration under President Joe Biden has maintained, and in some cases expanded, tariffs on Chinese imports and controls on exports to Beijing. A key development in this trajectory is the CHIPS Act, which provides substantial subsidies to bolster the domestic chip industry in the U.S. and aims to reduce dependence on Chinese supply chains. Additional restrictions have been placed on technology exports to China, with the stated goal of preventing sensitive technology from being utilized by the Chinese government for espionage and cyber warfare.

This evolving trade policy in the United States indicates a growing protectionist sentiment, a notable departure from its previous stance as a proponent of a liberalized, globalized trade system. This shift raises questions about the future of international trade relations and the impact on global supply chains and economic dynamics.

Stay current with supply chain report news at The Supply Chain Report. For international trade tools, see ADAMftd.com.

#InternationalTrade #TradePolicyShift #USProtectionism #GlobalTrade #PostWWIITrade #USChinaTrade #WTO #GATT #BidenTradePolicy #TrumpTradePolicy #Section301Tariffs #Section232Tariffs #CHIPSAct #DomesticManufacturing #SupplyChainReconfiguration #Globalization #TradeProtectionism #TradeWarImpact #EconomicRecovery #NationalSecurityTrade #USIndustry #ChinaRelations #TechExportControls #USChinaTariffDebate

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