The U.S. economy will be hit many times harder than
the rest of the world by an escalating global trade war, according to the chief
executive officer of A.P. Moller-Maersk A/S.
The company transports about 20 percent of the world’s
seaborne consumer goods, putting it in a unique position to gauge the fallout
of tariffs on trade flows.
Soren Skou, who runs the world’s biggest shipping
company from Copenhagen, said the fallout of the current protectionist wave
“could easily end up being bigger in the U.S.” Tariffs could slow global annual
trade growth by 0.1 to 0.3 percent, though for the U.S. the effect could be
“perhaps 3 or 4 percent,” he said at Maersk’s headquarters on Friday. “And that
would definitely not be good.”
Maersk focuses on trade flows between Europe and Asia
and so far its industry hasn’t been directly hurt by tariffs. In fact, demand
grew 4 percent in the second quarter. But Skou says that may change if the U.S.
starts targeting consumer goods.
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“The first thing the American importers would do if
tariffs are put on Chinese consumer goods would be to buy in Vietnam, in
Indonesia or elsewhere in Asia,” Skou said. “Big U.S. consumer brands like Nike
produce in all of Asia, not just in one country, so there will be a
The U.S. put duties on $34 billion of Chinese goods
last month, citing unfair trade practices by the world’s second-biggest
economy. The Trump administration has said it will impose tariffs on a further
$16 billion on Aug. 23, and even signaled it won’t shy away from targeting the
entire $500 billion in Chinese exports to the U.S.
“The other factor is that there’s a lot of stuff
that’s now imported into the U.S. that just isn’t produced anywhere within the
U.S.,” Skou said. “You can’t get Nike sneakers or iPhones that are produced in
the U.S. So it will end up being pushed on to the consumer.”