Eurasia Group CEO Predicts US-China Trade War in 2023
Eurasia Group founder and president Ian Bremmer anticipates a trade war between the US and China this year as Donald Trump re-enters the presidency.
"There's a fight that's coming," Bremmer told Yahoo Finance during the World Economic Forum in Davos, Switzerland. "Everyone around Trump is pushing to decouple the US economy from China's."
Trump has threatened tariffs of 10% on Chinese goods, 25% on Mexican and Canadian goods. However, a Wall Street Journal report suggests he may only outline his trade vision without imposing immediate tariffs.
According to Bremmer, China's different economic situation distinguishes it from other countries likely to be affected by tariffs. While Mexico, Canada, and Europe may initially resist, they will eventually reach a compromise. China, facing economic challenges, is less likely to capitulate to Trump's demands.
"We're heading towards a trade war with China this year," Bremmer predicts.
Another factor complicating US-China relations is the TikTok ban. Trump has promised to extend the ban, despite legal concerns over his authority.
"What Trump is saying he wants to do with TikTok is at odds with the legislation passed by Congress and upheld by the Supreme Court," Bremmer says. "It's unclear what Trump can actually do."
Bremmer also warns of a "G-Zero" era where no global power drives the international agenda.
"It's the law of the jungle where powerful individuals do as they wish, and everyone else suffers," he says.