With the trade war between the US and China on the brink of re-escalating once more, a journalist told ABS-CBN News Philippines that damage to global supply chains from the trade war might be “irreversible.”
President Trump threatened to slap tariffs Monday on the remaining $300 billion of Chinese exports to the US if China’s President Xi Jinping didn’t meet with him at the 2019 G20 Osaka summit on 28–29 June 2019.
Simon Rabinovitch Asia editor for The Economist told the ABS-CBN host that economic warfare had interrupted complex global supply chains, which took several decades to construct, are now “less efficient.”
“Even if the tariffs are reversed, the damage itself is irreversible. This is like a massive oil tanker and since it’s begun to shift direction, begun to shift course, it can’t go back to the way it used to be,”
The global economy has experienced an “extremely long recovery” from the dark days of the 2008 financial crisis, and the business cycle tends to revert into the contraction phase every decade, he said.
However, there’s hope; he said domestically-driven economies like the Philippines and India are “a little bit sheltered” from the global synchronized slowdown driven by the trade war.