The director-general of the World Trade Organization or WTO, Roberto Azevedo, in an interview with CNBC, said that the trade war between the U.S. and China hurts workers with lower salaries the most.
The trade dispute between the world’s two largest economies continues to cause turmoil in the global financial market. The two have recently hit each other with increased tariffs. U.S. President Donald Trump’s executive order to ban Chinese tech giant Huawei from purchasing key technology components from U.S. firms has only made the situation worse.
Azevedo said the trade war has caused investors and consumers to hold back, hurting the global economic growth. He reiterated that lower-salary earners will take the biggest hit.
Consumer goods will be more expensive
The trade war escalated when president Trump tweeted that he would increase tariffs on $200 billion worth of Chinese goods. From 10%, Trump raised it to 25%. China then hit back with 5% to 10% duties on U.S. goods worth $60 billion.
We have previously reported that consumers will shoulder the burden of increased tariffs. Consumer-focused items including clothing, shoes, and electronics like TVs and mobile phones will bear additional costs in the coming months. Before the wave of next tariffs hit, market experts recommend consumers to make a purchase.
Trump reiterates that the U.S. is winning the trade war. The vocal president assures U.S. farmers that they will soon see the benefits of his tactics. Additionally, in a tweet, Trump said U.S. consumers can avoid the tariffs if they buy from non-Tariffed countries. He added, “many Tariffed companies will be leaving China for Vietnam and other such countries in Asia. That’s why China wants to make a deal so badly! There will be nobody left in China to do business with. Very bad for China, very good for USA!”.
