Category Archives: European Union

Britain, Economic, European Union, Government, International trade, Politics, Society, United States

Trump’s tariffs: a deliberate and revengeful choice

WORLD TRADE

DONALD TRUMP’S revisionist structure of world tariffs against an already embattled trading system is as though an asteroid has crashed into the planet, devastating everyone and everything that previously existed there. The comparison is useful but there is this important difference. If an asteroid struck the Earth, the impact would at least have been caused by ungovernable cosmic forces. The assault on world trade, by contrast, is a completely deliberate act of choice, taken by one man and one nation.

The US President’s decision to impose tariffs on every country in the world is a shocking and momentous act of folly. Unilateral and unjustified, it was expressed in indefensible language in which Mr Trump described US allies as “cheaters” and “scavengers” who “looted”, “raped”, and “pillaged” the US. Many of the calculations on which he doled out his punishments are perverse, not least the exclusion of Russia from the condemned list. The tariffs – imposition of direct taxes – mean prices are certain to rise in every economic sector – in the US and elsewhere – fuelling inflation and very likely recession. Trump will presumably respond as he did when asked about foreign cars becoming more expensive: “I couldn’t care less.”

The tariffs – a minimum of 10% on all imports to the US, with higher levels on 60 nations that have been dubbed the “worst offenders” – throw a hand-grenade into the rules-based global trading order. These are large hikes, even for nations like Britain that have escaped the higher tariffs. They are indiscriminate between sectors, highly discriminatory against nations, even to the extent of penalising uninhabited islands in Antarctica. Foul.

The world trading system established under US leadership at Bretton Woods after the Second World War has been overturned. In effect, the nation that has underpinned the global economy for the last 80 years has expelled itself from the trading system it always led. That system’s cardinal principle – that countries in the World Trade Organisation should treat one another equally – has been blown apart.

The ceremony on which Trump made his announcement conveyed the thrill he derives from bullying and domination. A month after shutting down US development aid, his retribution list embodies special contempt for the world’s poor – 47% tariffs on Madagascar, the world’s ninth poorest country, for instance, or 44% on devastated Myanmar. While much pre-announcement rhetoric was directed at China, some of the toughest tariffs have been inflicted on countries such as Cambodia, Vietnam, Thailand, and Laos. The impact on US soft power is likely to be devastating.

In the UK, the government is trying to remain stoic. Like its trustworthy trading allies, Britain must do what it can to maintain the rules-based trading system by keeping calm. But economic war is clearly beckoning. The UK is now said even to be preparing a list of reciprocal tariffs on US goods. It is particularly vital that Britain defends its interests in food and health systems, and against the powerful digital tech giants.

Any kind of notion that Britain is some kind of winner in these circumstances, thanks to Brexit, is nonsensical. This country’s supposedly closest ally, the US, has just hiked the cost to British exporters by 10%, with an even greater rise of 25% in the case of steel, aluminium, and cars. The consequences of Trump’s tariffs will not be restricted to world trade but will impact on the global economic system more generally. This is a momentous macro moment. It will require macro responses.

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Britain, Defence, Europe, European Union, France, Government, NATO, Politics, Russia, Society, Ukraine, United States

Europe can deal with America’s perfidy

A NEW WORLD ORDER

Intro: Europe is stepping up. If it perseveres, and its leaders keep their promises, then it will be better able to deter Russia on its own – and survive in a reordered and more hostile world

A WATERSHED moment is upon us as Britain and the entire European continent faces a turning point, a second Zeitenwende, and a new world order. Whichever turn of phrase best describes the dramatic shifts unfolding since Donald Trump began his second US presidential term in January, one thing is certain: nothing will be the same again. The key question now is what, in practical terms, Europe can and will do to meet this challenge. Is this paradigm shift in the world order Europe’s moment, when it finally comes of age as a global player? Or will the EU and its close neighbours collectively fail to rise to the occasion, condemning their citizens to an era of domination by bigger and more determined rapacious powers?

With incautious recklessness, Donald Trump is in the process of attempting to do three extraordinary things. First, he is trying to force Ukraine, which has spent more than three years under murderous assault, to accept a “peace deal” on inimical terms dictated by himself and the aggressor, Vladimir Putin’s Russia. Second, in a stunning reversal of US policy, he is seeking a rapprochement with Moscow that includes re-establishing full political and diplomatic relations, lifting sanctions and launching joint economic partnerships. Third, he is telling Europeans they must henceforth defend themselves; that the US, in effect, is no longer a loyal, reliable partner or even necessarily a friend, and that NATO, for 76 years the solid bedrock of transatlantic security, is dispensable.

European leaders are broadly united in their alarm at all three of these unwise, irrational, and dangerous interventions. At the same time, most accept that even if Trump didn’t hold office, a change in the balance of US-Europe relations is inescapable and more than overdue. In a national address, Emmanuel Macron, France’s president, summed up the position well: “Europe’s future should not be decided in Washington or Moscow,” he said. “The war in Ukraine… continues with the same intensity [but] the US, our ally, has changed its position.” As a result, Europe was entering a new era of self-reliance.

Mr Macron, like many others, was accused of appeasing Putin in 2022. He has learned better since. He warns now that Russian imperialist aggression “knows no borders”, directly threatening France and Europe. This is not just talk. He has shown imaginative leadership, producing a tentative plan for a staged ceasefire that has Ukrainian support, lobbying, flattering, and even correcting Trump to his face in the Oval Office. The French president has also been promoting an Anglo-French proposal to deploy a European “assurance force” in Ukraine composed of a so-called coalition of the willing.

There has been repeated recourse in recent days for Europe to “step up” as a matter of urgency. Germany surprised many with a positive leap into the future. A country that nurtures visceral horror of debt announced a spectacular U-turn of its own – the amending of its Basic Law to permit multibillion-euro investments in defence and national infrastructure. Quite remarkable given that Friedrich Merz, the Christian Democrat who held off the far-right to win last month’s federal election, has a reputation as a fiscal conservative. Not any more. And he has gone further even than Macron in urging Europe’s “independence” from the US and pledging ongoing, expanded military aid for Kyiv. Other European leaders, notably Donald Tusk, have “stepped up” in commendable ways, too. Poland’s prime minister is in an unenviable position. A strong adherent in the transatlantic alliance, he, like so many others, now must feel utterly betrayed by Trump. There is a real sense of perfidy in the air. NATO is a crucial shield for Poland, as it is for the three neighbouring Baltic republics.

Keir Starmer also recognises the historic nature of this moment, and has risen to meet it. He has worked assiduously and with due care to restrain Trump’s worst instincts. His evident contempt, displayed in the House of Commons, for the ignorant comments of US vice-president JD Vance about “random countries” showed he is not afraid to push back. The PM’s collaboration with EU leaders is a very welcome post-Brexit development that should be extended beyond defence and security. Yet like them, the UK faces daunting hurdles.

These challenges – on reducing Europe’s reliance on America, boosting its defences, and maintaining support for Ukraine – were the focus of the emergency EU summit. As is often the case in Brussels, the results were mixed. New overall defence spending of £670bn was agreed. But whether it ever materialises will depend on national governments’ willingness to borrow. The usual divisions were apparent – such as Hungary blocking a joint statement on Ukraine. Within NATO, most member states, like Britain, are now committing to higher spending. Non-EU countries, such as Norway, are also piling in. Oslo is belatedly, yet commendably, doubling its aid to Kyiv.

Europe is stepping up. If it perseveres, and its leaders keep their promises, then it will be better able to deter Russia on its own – and survive in a reordered and more hostile world. But how effective Europe can be in rescuing Ukraine in the short term from a developing Trump-Putin axis is in serious doubt. Trump still refuses to provide Kyiv with meaningful post-war security guarantees. His suspension of military aid, mapping, and intelligence assistance is encouraging Russia to intensify attacks. More civilians are dying each day because of Trump’s treachery. With each passing day, Ukraine is further brutalised and degraded. A just peace looks further away than ever. 

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European Union, Kosovo, NATO, Serbia, United States

NATO needs to strengthen its hand in Kosovo

KOSOVO

Intro: Two decades since NATO intervened in Kosovo, and almost 15 years since the country declared independence, Serbia’s refusal to accept Kosovo’s sovereignty is increasing the possibility of renewed conflict in the region

EARLY last month, ethnic Serbs in northern Kosovo – near the Serbian border – started setting up roadblocks. They were protesting against the arrest of an ethnic Serb former police officer. The situation soon escalated into a dangerous impasse between Kosovo and Serbia, with Pristina calling on NATO-led international peacekeeping forces in Kosovo (KFOR) to intervene, and Belgrade announcing its forces was on “the highest level of combat readiness” due to tensions at the border.

Following dialogue between Serbia’s President Alexandar Vucic and Kosovo’s Western partners that no arrest would be made over the incident, the protesters eventually started dismantling the roadblocks on December 29.

With the reopening of border crossings, the crisis appeared to come to an end. But the escalation in December was not the first incident that almost pushed Serbia and Kosovo into open conflict. It is unlikely it will be the last. The fragile relationship between the two neighbouring countries has been on the verge of collapse since last summer, when Kosovo’s government started taking steps to exercise sovereignty over the country’s entire territory. This included the demand that all citizens of Kosovo (including ethnic Serbs) start carrying IDs and using licence plates issued by Kosovo. In response, ethnic Serbs in the north barricaded roads and threatened violence, leading KFOR forces to start patrolling the streets in the region. A few days later, following mediation by the EU and US, Pristina and Belgrade reached a deal on ID documents but left the issue of licence plates to be resolved at a later date. That was resolved in November, with a signing of a deal that required Serbia to stop issuing licence plates with markings indicating Kosovo cities and Kosovo to cease its demands for reregistration of vehicles carrying Serbian plates.

The latest standoff at the borders came just a few weeks after this landmark deal, demonstrating quite clearly that the tensions between Kosovo and Serbia are chronic. They will not be truly resolved until mutual recognition is achieved.

Recent escalations between Serbia and Kosovo have followed a clear pattern. Kosovo attempts to exercise sovereignty over its whole territory; Belgrade responds by stoking unrest using the ethnic Serbs in the north as its proxies. The EU steps in, brokers a deal and stops the unrest from escalating into cross-border conflict. Then the cycle is repeated.

All of this shows that the recurring tensions have little to do with the practicalities of governance (such as licence plates), and everything to do with one core issue: Kosovo’s independence.

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