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G20 preview: Trade wars and the EM impact

  • All eyes will be on US-China trade negotiations, with Presidents Trump and Xi Jinping set to meet

  • The subsequent lull in trade tensions between the two countries suggests there might be reasons for optimism

  • This report, part one of two, explores the impact of trade wars, US-China in particular, on EM and FM

G20 preview: Trade wars and the EM impact
Christopher Dielmann CFA
Christopher Dielmann CFA

Director, Macroeconomic & Sovereign Research

Stuart Culverhouse
Stuart Culverhouse

Head of Sovereign & Fixed Income Research

Tellimer Research
26 June 2019
Published by
  • All eyes will be on US-China trade negotiations, with Presidents Trump and Xi Jinping set to meet during the G20 summit in Osaka, 28-29 June.
  • The US has already applied tariffs of 10-25% on over US$250bn-worth of goods, with an additional US$300bn in jeopardy.
  • US imports from China have declined markedly in the 14 months since Trump’s first tariff announcement in April 2018.
  • Trade theory predicts that trade tensions and tariffs will result in a generalised welfare loss; however, disruptive and distributive impacts are likely to result in an uneven impact by country. 
  • In this report, part one of two, we explore some of the channels that trade wars in general – and the US-China trade war in particular – could have on emerging and frontier markets. Part two will identify the potential winners and losers among emerging and frontier countries if the tensions continue.
US imports from China have fallen much more than imports from Rest of the World ex-China (US$bn)

Source: US ITC, Tellimer