Evelyn Reynolds

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    E.U. Officials Set to Vote Today on First Retaliatory Tariffs

    The European Union plans to vote on Wednesday afternoon on its first retaliation measures in response to President Trump’s tariffs, moving closer to placing increased duties on a range of manufactured goods and farm products that would take effect in phases starting next week.The list up for consideration is a slightly trimmed down version of one that was announced in mid-March in response to Mr. Trump’s steel and aluminum tariffs. E.U. officials have spent recent weeks consulting with policymakers and industries from across the 27-nation bloc in an effort to minimize how much the countermeasures would harm Europeans.The final list is expected to exclude bourbon, for instance, after Mr. Trump threatened to place a 200 percent tariff on all European alcohol in response to its inclusion. That would have been a crushing blow for wine producers in France, Italy and Spain.“We are not in a business of going, let’s say, cent for cent, or tit for tat, or dollar for dollar,” Maros Sefcovic, the bloc’s trade commissioner, said this week.Since last month, the United States has introduced tariffs of 25 percent on steel, aluminum and cars, and broad 20 percent on everything else coming from Europe — and those broad-based tariffs took effect on Wednesday. European Union officials have said they would prefer to negotiate to get rid of those higher levies, and have even offered to cut tariffs to zero on cars and other industrial products if the United States does the same.But with serious negotiations slow to materialize, Europe is striking back in a staggered way. The retaliatory tariffs up for a vote on Wednesday would be a first step, in response only to steel and aluminum levies.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    The oil-rich Gulf states are better-positioned to weather the tariff storm — but crashing crude prices could spell trouble

    The Arab Gulf states’ warm relations with Trump and central role in U.S. diplomatic efforts should strengthen their hand when it comes to potential tariff negotiations, analysts told CNBC.
    A lower oil price hit by the tariff wars, however, can affect the budget deficits and spending plans of these hydrocarbon-reliant countries.
    The countries of the Gulf Cooperation Council — Saudi Arabia, the United Arab Emirates, Bahrain, Kuwait, Oman, and Qatar — hold approximately 32.6% of the world’s proven crude oil reserves.

    U.S. President Donald Trump with Mohammed bin Salman, crown prince of Saudi Arabia, at the start of the Group of 20 summit on 28 June 2019.
    Bernd von Jutrczenka | picture alliance | Getty Images

    DUBAI, United Arab Emirates — The wealthy Arab Gulf states are in a better position than many other regions of the world to manage the economic impact of U.S. President Donald Trump’s tariffs, economists and regional investors say. But a shaky outlook for the price of oil could put some countries’ budgets and spending projects at risk.
    Saudi Arabia, the United Arab Emirates, Bahrain, Kuwait, Oman, and Qatar make up the Gulf Cooperation Council. Together, they comprise around $3.2 trillion in sovereign financial assets, accounting for 33% of the total sovereign assets worldwide, according to GCC Secretary-General Jasem Mohamed Albudaiwi. 

    The GCC also holds approximately 32.6% of the world’s proven crude oil reserves, according to the Statistical Center of the Cooperation Council for the Arab States of the Gulf.
    That makes it both an asset for the Trump administration as well as vulnerable to its policies, as Trump has long pushed for OPEC, the oil producer alliance led by Saudi Arabia, to pump more oil to help lower oil prices and offset inflation in the U.S. 
    A lower oil price, however, can significantly impact the budget deficits and spending plans for those countries, whose economies — despite diversification efforts — still rely heavily on hydrocarbon revenues.  

    Beneficial relations with Trump  

    Ben Powell, BlackRock’s chief investment strategist for Asia-Pacific and the Middle East, who is based in Abu Dhabi, said the region’s warm relations with Trump strengthens its hand when it comes to potential tariff negotiations. Some GCC countries have also expanded their role in global diplomacy. One example is Riyadh’s hosting of peace talks to end the Russia-Ukraine war, which has made it ever more important to Washington.  
    “I do think the Middle East, with the deep relationship with the U.S. that they have, should come out okay,” Powell told CNBC’s “Access Middle East” on Monday. 

    “I think we’re all going to be swept into the maelstrom over the next short period of time. That’s inevitable. But the Middle East, with the balance sheet strength that they have, with the energy support that they still have, providing funding on a near ongoing basis … for me, the Middle East — maybe not today, but over time — should be a relative winner within that mix” when it comes to emerging markets, Powell said.
    In considering what the firsthand impact of tariffs might be, Monica Malik, chief economist at Abu Dhabi Commercial Bank, noted that the U.S. is not a major export market for the Gulf.
    “The GCC should be in a relatively favourable position to withstand headwinds, especially the UAE,” she wrote in a report for the bank on Friday. 
    While the region faces the blanket 10% universal tariff as well as previously imposed tariffs on all foreign steel and aluminum — products that the UAE and Bahrain both export — “we expect the direct impact to be relatively contained, as the US is not a key destination for Gulf exports, averaging just c.3.7% of the GCC’s total exports in 2024,” she said.

    Threat to spending plans

    But the oil price outlook is critical for Gulf states’ budgets and future spending plans — particularly for Saudi Arabia, which has embarked on trillions of dollars worth of ambitious mega-projects as part of Vision 2030, Crown Prince Mohammed bin Salman’s sweeping initiative to diversify the kingdom’s economy away from oil. The success of the plan, perhaps ironically, relies heavily on oil revenues. 
    Global benchmark Brent crude was trading at $61.44 per barrel on Wednesday at 8:30 a.m. in London, down nearly 17% year-to-date. Additional pressure was put on the price after OPEC+, the oil producer alliance led by Saudi Arabia and Russia, made a surprise decision to accelerate planned crude production hikes, further bolstering global supply. 

    Saudi Arabia needs oil at more than $90 a barrel to balance its budget, the International Monetary Fund estimates. Goldman Sachs this week lowered its oil price forecast for 2026 to $58 for Brent and $55 for U.S. benchmark WTI crude. That’s a significant move lower from its forecast just last Friday of $62 for Brent and $59 for WTI in 2026.
    “A weaker global demand and greater supply adds downside risk to our Brent forecast for 2025, though we wait for more market clarity before making any changes,” ADCB’s Malik told CNBC on Monday. OPEC+ is meant to increase oil production levels again in May, and she predicts the group will pause that plan if crude prices stay where they are or fall further. 
    “Our greatest concern would be a sharp and sustained oil price fall, which would require a reassessment of spending plans – government and off budget – including capex, while also potentially affecting banking sector liquidity and wider confidence,” Malik warned. More

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    China Censors Hashtags Mentioning ‘104%,’ the Size of Trump’s Tariffs

    Chinese censors appeared to be carefully curating public discussion about the U.S. tariffs that took effect on Wednesday. They promoted criticism of the United States, while seemingly playing down the specifics of how President Trump’s move would effectively increase import taxes on Chinese goods to 104 percent.On Weibo, a popular social media platform, several hashtags that used the number 104 — such as “104 tariff rate” or “America to impose 104 percent tariff on Chinese goods” — returned an error message that said: “Sorry, the content of this topic is not displayed.”But other hashtags that focused more squarely on mocking the United States, or on touting China’s strengths, were allowed to trend — and in fact were explicitly initiated by state media. “America is fighting a trade war while begging for eggs” was one popular hashtag started by CCTV, China’s state broadcaster. “China does not provoke trouble but is never afraid of it” was another.State media outlets adopted a similarly swaggering tone in their coverage. Several opinion pieces in the People’s Daily, the Chinese Communist Party’s official mouthpiece, declared that China had learned from years of trade frictions to diversify and shore up its economy. “In Chinese people’s genes, we never fear any risks, challenges, difficulties or contradictions, and can regard all kinds of external pressure as the driving force for our own progress,” one piece said.Other pieces did not directly reference the tariffs but still touted the strengths of the Chinese economy. A front-page article in the People’s Daily laid out steps that the government would take to promote employment for fresh graduates.Mr. Xi himself has not publicly addressed the new tariffs. But on Wednesday afternoon, Chinese state media published his first public remarks since the latest escalation in the trade war, saying that he had met with his innermost circle of top officials on Tuesday and Wednesday.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump Maintains 104% China Tariffs as U.S. Officials Signal Openness to Talks

    President Trump’s next round of punishing tariffs on some of America’s largest trading partners was set to go into effect just after midnight on Wednesday, including stiff new levies that will increase import taxes on Chinese goods by at least 104 percent.Mr. Trump acknowledged on Tuesday that his tariffs had been “somewhat explosive.” But throughout the day he continued to defend his approach, saying that it was encouraging countries with what he calls “unfair” trade practices to offer concessions.“We have a lot of countries coming in to make deals,” he said during remarks at the White House on Tuesday afternoon. At a dinner with Congressional Republicans in Washington later that evening, he said other countries wanted to make a deal with the United States but he was happy just collecting the revenue from tariffs, which he claimed would reach $2 billion a day.“I know what the hell I’m doing,” he said, adding that he would be announcing “a major tariff on pharmaceuticals” very shortly.The president and top administration officials signaled on Tuesday that the White House was ready to negotiate deals, saying that 70 governments had approached the United States to try to roll the levies back. Mr. Trump said officials would begin talks with Japan, South Korea and other nations.The president, whose punitive and successive tariffs on China have triggered a potentially economically damaging trade war, also said he was open to talking to Beijing about a deal.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Musk Slams Navarro, Trump’s Trade Adviser, Exposing Inner Circle Rift

    Elon Musk slammed President Trump’s top trade adviser as “dumber than a sack of bricks” on Tuesday, exposing a remarkable rift in the president’s inner circle over the wide-ranging tariffs that have upended the global economy.The feud between Mr. Musk and Peter Navarro, who has been the architect of many of Mr. Trump’s trade plans, has been simmering for days as the administration’s new tariffs have caused huge losses across global financial markets.So far, Mr. Trump has not weighed in on the clash between his top aides, both of whom he claims to hold in high regard. But Mr. Musk’s words — though aimed at Mr. Navarro — were a rare criticism of Mr. Trump’s policies from one of his most influential advisers.Mr. Musk, the world’s richest man, is estimated to have lost roughly $31 billion since Mr. Trump announced sweeping tariffs on foreign countries on April 2, according to the Bloomberg Billionaires Index.The squabble escalated on Monday when Mr. Navarro said on CNBC that Mr. Musk was not a “car manufacturer” but a “car assembler” because Tesla, Mr. Musk’s electric vehicle company, relied on parts from around the world.Mr. Musk fired back on Tuesday, calling Mr. Navarro a “moron” and “dumber than a sack of bricks” in a post on X, the social media site he owns. Later in the day, Mr. Musk doubled down, posting that he wanted to “apologize to bricks.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Stock Market Chaos Over Tariffs Could Take Toll on Economy

    A big hit to portfolios would be felt acutely by higher-income Americans, whose spending has recently been the biggest driver of the economy.This time, maybe the stock market is the economy.Financial markets around the world have plummeted in the days since President Trump announced sweeping tariffs, setting off a global trade war. The S&P 500 declined more than 10 percent in two days last week, and it swung wildly on Monday amid news of further tariffs and rumors of delays. Stock indexes in Asia and Europe have fallen sharply as well.Experts often caution that the stock market can be a misleading measure of the broader economy. Share prices can move for a host of reasons — technological developments, shifts in consumer preferences, changes in tax or interest rate policy.Sometimes, though, the markets carry an economic message — and in recent days, they have been speaking unusually clearly. Investors overwhelmingly believe that Mr. Trump’s tariffs, and retaliation from U.S. trading partners, will lead to higher prices, slower growth and possibly a global recession.Plunging stock prices may not just reflect fears of a recession. They may also help cause one, as consumers pull back spending in response to their portfolios’ evaporating value.A few days of turmoil might not matter much, said Ryan Sweet, chief U.S. economist at Oxford Economics, a forecasting firm, “but if the drop in the stock market persists for a few weeks, a couple months, the economic costs begin to quickly mount.”The direct effects of tariffs will fall hardest on low- and moderate-income consumers, who tend to spend more of their money on food, clothing and other goods subject to duties, and who have less savings to insulate them from higher prices. But market declines will be felt most acutely by higher earners, who own a disproportionate share of stocks and other investments.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    How China, Canada and Other Nations are Responding to Trump’s Tariffs

    <!–> –><!–> [–><!–> –><!–> [–><!–> –><!–> [–><!–>The other was Canada, which last month placed tariffs on a variety of U.S. goods. The European Union, while signalling that it would prefer to negotiate, is said to be working to finalize a list of U.S. goods that it would target.–><!–> –><!–> [–><!–>Other economies — even large ones […] More

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    Global Leaders Rush to Woo Trump, Hoping to Sway Him on Tariffs

    Dozens of foreign governments were trying to appeal to the president to have steep tariffs rolled back, but the president and his advisers have indicated negotiations could be difficult.President Trump’s plan to impose sweeping tariffs on most of America’s trading partners has governments across the globe racing to schedule phone calls, send delegations to Washington and offer up proposals to lower their import taxes in order to escape the levies.On Monday, European officials offered to drop tariffs to zero on cars and industrial goods imported from the United States, in return for the same treatment. Israel’s prime minister was expected to personally petition Mr. Trump on Monday in meetings at the White House. Vietnam’s top leader, in a phone call last week, offered to get rid of tariffs on American goods, while Indonesia prepared to send a high-level delegation to Washington, D.C., to “directly negotiate with the U.S. government.”Even Lesotho, the tiny landlocked country in Southern Africa, was assembling a delegation to send to Washington to protest the tariffs on its exports to the United States, which include denim for Calvin Klein and Levi’s.Mr. Trump and his advisers have given mixed signals on whether the United States is willing to negotiate. On Sunday, Mr. Trump said that the tariffs would remain in place until U.S. trade deficits disappeared, meaning the United States is no longer buying more from these countries than it sells to them. But the administration still appeared to be welcoming offers from foreign nations, which are desperate to try to forestall more levies that go into effect on Wednesday.On Monday, as markets recoiled for a third day and Mr. Trump threatened even more punishing tariffs on China, the president said that “negotiations with other countries, which have also requested meetings, will begin taking place immediately.”“Countries from all over the World are talking to us,” the president wrote on Truth Social on Monday morning. “Tough but fair parameters are being set. Spoke to the Japanese Prime Minister this morning. He is sending a top team to negotiate!”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More