Topic Of The Day:-“A Vicious Cycle: On Trade Wars”
Nobody wants to lose a trade war. The European Commission on Wednesday announced it would impose tariffs as high as 25% on imports worth $3.3 billion from the U.S. beginning July. A whole range of American goods, from motorbikes and jeans to peanut butter and orange juice, will now face higher taxes when sold in the European Union zone. The Commission is also mulling import duties on more American goods if the trade war with the U.S. intensifies. Europe is not alone in waging a battle against imports from the U.S.; China, Mexico and Canada have joined hands in response to President Donald Trump’s decision to impose tariffs on steel and aluminium imports. Last week, the U.S. imposed a 25% tax on steel and a 10% tax on aluminium imports from the EU, Mexico and Canada. The first salvo in this ongoing trade war, however, was fired by Mr. Trump in March this year, when he imposed tariffs on Chinese steel and aluminium to protect American producers. Workers in America’s manufacturing sector have played a key role in Mr. Trump’s electoral success, so his zealousness to be seen to be protecting their interests is unsurprising. However, consumers in America and the rest of the world are likely to suffer as their respective governments make it costlier for them to access foreign goods and services. Judging by their actions, it is now clear that America’s major trading allies would not really want to lose this trade war against the U.S. The sad fact, however, is that at the end of the day nobody actually wins a destructive trade war. Tariffs that seek to disadvantage foreign producers in favour of domestic producers, whether they are imposed by the U.S. or any of its major trading partners such as Europe or China, only increase the burden of taxes. What this leads to eventually is slower global economic growth. The World Bank has warned that the effect of the increased use of tariffs to regulate international trade could be similar to the significant drop in global trade after the financial crisis a decade ago. Countries that are protesting America’s metal tariffs in the name of free trade are also only encouraging further protectionism when they impose retaliatory tariffs. As former Reserve Bank of India Governor Raghuram Rajan aptly put it, the ongoing trade war is a “lose-lose situation” for the warring parties. The only winners will be special interest groups and consumers in countries that do not engage in the tit-for-tat tariff war, but their winnings will come at the cost of global growth. It is high time countries worldwide come together to promote the cause of free trade.
MEANINGS AND WORDS
1.)Impose
Meaning: Force (an unwelcome decision or ruling) on someone.
Example: “The decision was theirs and was not imposed on them by others”
Synonyms: Foist, Force.
2) Mulling
Meaning: The verb mull means to think deeply about something, the way you might mull over your choice of what college to attend. When you mull something over, you ponder or seriously consider it.
3) Wage
Meaning: Carry on (a war or campaign).
Example: “It is necessary to destroy their capacity to wage war”
Synonyms: Engage in, Carry on.
4) Salvo
Meaning: A simultaneous discharge of artillery or other guns in a battle.
Example: “A deafening salvo of shots rang out”
5) Fired
Meaning: Discharge a gun or other weapon in order to propel (a bullet or projectile).
Example: “He fired a shot at the retreating prisoners”
Synonyms: Launch, Shoot.
6) Zealous
Meaning: Enthusiastic and eager:
Example: “A zealous supporter of the government’s policies”
7) Unsurprising
Meaning: Not unexpected and so not causing surprise.
Example: “The outcome of this sombre film is unsurprising”
Synonyms: Predictable, Foreseeable.
8) Access
Meaning: The means or opportunity to approach or enter a place.
Example: “The staircase gives access to the top floor”
Synonyms: Entrance, Entry.
9) Judge
Meaning: Form an opinion or conclusion about.
Example: “A production can be judged according to the canons of aesthetic criticism”
Synonyms: Form the opinion, Come to the conclusion.
10) Allies
Meaning: A state formally cooperating with another for a military or other purpose.
Example: “Debate continued among NATO allies”
11) Destructive
Meaning: Causing great and irreparable damage.
Example: “The destructive power of weapons”
Synonyms: Devastating, Ruinous.
12) Eventually
Meaning: In the end, especially after a long delay, dispute, or series of problems.
Example: “Eventually, after midnight, I arrived at the hotel”
Synonyms: In the end, In due course.
13) Warned
Meaning: Inform someone in advance of a possible danger, problem, or other unpleasant situation.
Example: “His father had warned him of what might happen”
Synonyms: Notify, Alert.
14) Regulate
Meaning: Control or maintain the rate or speed of (a machine or process) so that it operates properly.
Example: “A hormone which regulates metabolism”
Synonyms: Control, Adjust.
15) Crisis
Meaning: A time of intense difficulty or danger.
Example: “The current economic crisis”
Synonyms: Catastrophe, Calamity.
16) Protesting
Meaning: Express an objection to what someone has said or done.
Example: “Before Muriel could protest, he had filled both glasses”
Synonyms: Express opposition, Raise objections.
17) Protectionism
Meaning: The theory or practice of shielding a country’s domestic industries from foreign competition by taxing imports.
18) Retaliatory
Meaning: (Of an action) characterized by a desire for revenge.
Example: “Fears of a retaliatory attack by the victim’s friends”
19) Aptly
Meaning: In a manner that is appropriate or suitable in the circumstances.
Example: “America’s aptly named Sunshine State”
