New trade war deadline prolongs instability, says UN trade agency

GENEVA – The Trump administration’s decision to extend a negotiating deadline for tariff rates is prolonging uncertainty and instability for countries, the executive director of the UN trade agency said on July 8.

US President Donald Trump on July 7 ramped up his trade war, telling 14 nations, from powerhouse suppliers such as Japan and South Korea to minor trade players, that they now face sharply higher tariffs from a new deadline of Aug 1.

“This move actually extends the period of uncertainty, undermining long-term investment and business contracts and creating further uncertainty and instability,” Ms Pamela Coke-Hamilton, executive director of the International Trade Centre, told reporters in Geneva.

“If a business is not clear on what costs they are going to pay, they cannot plan, they cannot decide on who will invest,” she said, citing the example of Lesotho – where major textile exporting companies have withheld their investment for the time being, pending a tariff outcome.

The uncertainty, combined with deep cuts in development aid, had created a “dual shock” for developing countries, she added.

Countries have been under pressure to conclude deals with the US after Mr Trump unleashed a global trade war in April that roiled financial markets and sent policymakers scrambling to protect their economies. REUTERS