Trump’s trade tariffs: A gun that turns on its master

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OPINION

By Salim Abila Asuman

Imagine a tariff as a gun, and a man in the US stands tall, calm and composed, with this polished gun in hand. He points it at his rivals, to intimidate, to demand respect, and to bend the room to his will. The barrel sunbeams are under the light that everyone watches. For a moment, power seems to be his.

But then there is a truth about this gun: it is unpredictable. It jams, it misfires, and sometimes in the tension of a standoff, it explodes backwards, tearing through the one who dared to wield it.

The US government has recently drawn tariffs like weapons in a duel intended to shield domestic industries and frighten foreign competitors. But it forgets the recoil. Higher consumer prices, retaliatory trade wars, crippled exports, and suppressed supply chains these are the wreckages that fly back and dwell deep into the economy that pulls the trigger of a tariffs.

A tariff can look like a strength. It can feel like control, but history has shown us time and again that it is a dangerous tool, best admired from a distance because in the wrong hands, or even in the right ones but on the wrong day, it does not just miss the target. It turns and shoots the shooter.

In 1930, amidst the Great Depression, the US passed the Smoot-Hawley Tariff Act, slapping tariffs on over 20,000 imported goods to protect American jobs. Instead, it triggered a global trade war where countries retaliated, international trade collapsed by over 60%, and American exports dried up. Far from a rescue plan, the Smoot-Hawley tariffs deepened the catastrophe it was meant to solve.

The US has once more turned to protectionism, and still in the form of tariffs, this time aimed at China again it is discovering that economic aggression invites economic retaliation.

The fact is that US tariffs on Chinese goods do not hurt China as much as they hurt American shoppers. Several studies, including from the Federal Reserve and the Independent Economist in the past, showed that more than 90% of tariff costs were passed to US consumers, driving up prices on essentials like electronics, machines, furniture and clothing.

China has responded to US tariffs with its own, hitting American agriculture, cars, and manufacturing. Because of this, exports from US farmers and factory towns are going to take a serious hit, and some industries are going to face double-digit losses in revenue.

Like most tariffs, the US tariffs on China are equally a short-term protection for vulnerable industries and shall stifle innovation by removing competitive pressure. Instead of modernising, industries in the US are going to become dependent on political shielding.

Why China stands to win; unlike the US, China approaches trade wars with strategic discipline and long-term planning. As the biggest rival to the US in global trade, it had long anticipated the imposition of tariffs and other protectionist measures. In response, it began diversifying its trade routes and market dependencies.

This strategic partnership included strengthening its economic ties in Africa and across parts of Asia regions that offer abundant resources and growing consumer bases and present a viable alternative to the American market.

Through initiatives such as the Belt and Road Initiative (BRI), Beijing systematically built infrastructure, signed bilateral trade agreements, and invested in significant sectors in Africa and Asia that facilitate smoother trade flows, and as such, mitigate the impact of Western trade barriers.

This foresight in diversifying its trade portfolio came out of the fact that China had long observed the growing protectionist sentiment in the West. The 2018 US tariffs, which targeted over $250b worth of Chinese goods, confirmed its anticipation, and it began preparing for a shift in global trade dynamics away from American dominance.  

For instance, in Ethiopia, the Addis-Ababa-Djibouti Railway, funded by China, links this African nation to the port of Djibouti. This, therefore, created a corridor that has become a vital artery for Ethiopian exports and Chinese imports.

The Lagos-Ibadan railway, funded by a $41.5b loan from Export-Import Bank, is also part of its effort to secure reliable trade infrastructure, and in exchange, Nigeria remains a key supplier of crude oil to China.

In 2020, it signed the Regional Comprehensive Economic Partnership (RCEP), the world’s largest trade pact with 14 Asia-Pacific countries that included Japan, South Korea, and ASEAN nations RCEP covers about a third of the world’s population and GDP.

Under the Belt and Road Initiative (BRI) the China-Pakistan Economic Corridor has received over $60b to build roads, railways, and to develop Gwadar Port. This initiative provides China with direct access to the Arabian Sea while bypassing the Strait of Malacca, a strategic chokepoint often times controlled by the U.S.

Uganda has also significantly benefited from the Belt and Road Initiative since it joined the initiative. especially through major infrastructure and energy projects such as the Karuma and Isimba dams, the Entebbe–Kampala Expressway, the Osukuru Industrial Complex, the Kingfisher Oil Field and the East Africa Crude Oil Pipeline (EACOP). These projects have also made Uganda an artery for Uganda exports, such as coffee and Chinese imports.

Countries in Africa and Asia that have partnered with China through BRI are likely to weather Trump’s tariffs better than others because their primary trade and infrastructure dependencies are now with China rather than the US. By restricting global trade and imposing unilateral tariffs, the US is pushing nations further into China’s embrace, yet many of these nations were allies or part of the Western development networks.

The irony is that Trump’s tariffs, meant to punish China, may end up punishing the future of America. Countries that once looked to the United States as a beacon of opportunity now see it as unreliable, unpredictable, and disinterested.

History will remember this moment not as China's downfall, but as the turning point that confirmed a timeless truth: what does not kill you makes you stronger.

The writer is a research fellow at the Sino-Uganda Research Centre.