Tag: International Trade and World Market

How Volkswagen’s Troubles Were Made in China

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Volkswagen has problems around the world, spurring it to announce on Thursday that it would slash the number of models it offers by as much as half, but many of its troubles can be traced to China. The German auto giant, the world’s second-largest carmaker after Toyota, led the pack in China, the world’s largest car market, for four decades. For many years, the company’s joint ventures and factories in China provided half or more of the company’s worldwide profits, which helped Volkswagen afford high salaries and generous benefits for…

America Was Being Played. The Bessent Doctrine Says Those Days Are Over.

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Treasury Secretary Scott Bessent delivered a remarkably important speech on June 23 at the Economic Club of New York. Yet neither Wall Street nor most of the economic profession seems to have paid it enough attention. By laying out what until now seemed more like haphazard policy measures, Mr. Bessent put down a marker for how the United States plans to operate in a changing global economic system. In the process, he elevated both the scale and the scope of a systemic change that started in earnest during President Trump’s…

U.S. Declines to Renew USMCA Trade Deal, Starting 10-Year Clock to Expiration

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The Trump administration on Wednesday declined to renew the trade deal President Trump negotiated with Canada and Mexico in his first term, a pact that he later came to criticize. The decision, though expected, was an important symbolic move for a trade deal the United States is currently trying to renegotiate. The move started a decade-long clock to the deal’s expiration, unless the three countries unanimously decide to renew it. The text of the U.S.-Mexico-Canada Agreement required the three countries to jointly meet to review the agreement six years after…

China Emerges as a Relative Winner From Strait of Hormuz Crisis

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The war in Iran and the effective closure of the Strait of Hormuz have inflicted deep economic pain on many countries and sent some industries into a tailspin as they struggled with higher prices for energy, fertilizer and chemicals. It may also have given China a competitive edge. While the energy shocks and supply chain challenges stemming from the war have posed some challenges for China, the country has largely managed to avoid the kind of inflation spike and cascading economic and political effects that have afflicted many other nations.…

China Detained 2 Japanese on Suspicion of Smuggling

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China has detained two Japanese citizens on suspicion of smuggling banned products, the Japanese government said on Wednesday, adding to rising tensions between the two countries. The Japanese nationals were detained in May in the northeastern Chinese city of Dalian, according to a statement by Japan’s government. Chinese officials have indicated that they are being held on “on suspicion of violating the law and smuggling goods that are prohibited from being imported or exported,” Minoru Kihara, a top Japanese cabinet official, said at a news conference in Tokyo on Wednesday.…

China Tightens Rare-Earth Grip on U.S. Firms, Threatening Trade Clash

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China took aim on Monday at a U.S. government program to reduce American reliance on Chinese imports for rare-earth magnets, a move that risks reigniting trade tensions with President Trump. New restrictions will prohibit Chinese companies from shipping certain rare-earth metals to two companies that are leading the Trump administration’s efforts to revive the American rare-earth industry. The metals banned by China’s Ministry of Commerce are critical for a wide range of products, from cars to military drones, and China controls nearly the entire global supply of them. After meeting…

Iran Just Taught the World a Dangerous Lesson

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The United States and Iran have a deal: For 60 days, Tehran will allow ships to sail through the Strait of Hormuz without charging tolls; in return, Washington will lift its naval blockade, waive sanctions on Iranian oil and help Iran get access to its frozen assets. Negotiations on the future of Iran’s nuclear program are also set to begin. Even if the deal holds, Iran is poised to emerge from the war battered militarily and economically but strengthened strategically, the newly empowered gatekeeper of the world’s most important energy…

While the World Scrambles for Oil, China Sits on Full Tanks

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While the United States and Iran haggle over reopening the Strait of Hormuz and restoring oil exports from the Persian Gulf, China, the world’s largest oil importer, is not expected to quickly ramp up purchases from the region. If normal traffic through the strait fully resumes in the coming weeks, numerous tankers carrying oil bound for China that have been stranded in the Persian Gulf during the war would be on the move again. Their eventual arrival at Chinese ports is likely to produce a temporary surge in deliveries. China…

U.S. Will Waive Oil Sanctions That Have Long Crimped Iran

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The U.S. will lift sanctions on Iran’s oil industry when a preliminary deal is signed in what amounts to a major financial win for the country. Iran’s energy industry — the lifeblood of its economy — has been subject to financial restrictions for many years. Assuming its deal with the United States holds, Iran will probably be able to charge more for the oil it exports and sell that fuel to many more buyers. It is one area where the country appears likely to end the war on better footing…

China’s Spending Slowdown Deepens as Households Tighten Their Belts

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China’s consumer spending slowdown deepened in May as retail sales unexpectedly fell from a year earlier, in the latest sign that the country’s housing market crash has left millions of families reluctant to spend. Retail sales dropped 0.6 percent in May from the same month a year earlier, the National Bureau of Statistics said on Tuesday. It was the first year-over-year decline since December 2022, when a wave of coronavirus infections swept the country and kept consumers at home after Beijing abruptly dismantled its stringent “Covid zero” restrictions. Last month’s…