By Dionisia Tabureguci in Suva
International trade expert Steven Okun has warned that the “era of uncertainty” in global trade set in motion by US President Donald Trump’s tariff policies is likely to be prolonged as there is no certainty now of a US return to pre-Trump trade policy era
He has advised small economies like Fiji and Pacific countries to band together and try to negotiate a collective trade agreement with the US.
“We’re in a transitional phase and this transitional phase is going to take years,” Okun said in an interview with The Fiji Times during his visit to Fiji earlier this month.
“This isn’t months, this is going to be years and after Donald Trump is no longer president, the question is going to be who replaces him. And we just have no idea.
“If the replacement for Donald Trump is a Democrat, is that Democrat going to be more like Joe Biden — work with partners and allies — or is he going to be more progressive like Bernie Sanders, and he or she is going to have a different approach to trade.
“We don’t know which way the Democrats are going to go.
“We don’t know which way the Republicans are going to go. Either the successor is going to be somebody more of a traditional Republican, somebody like the Governor of Georgia or the Governor of New Hampshire who are both more establishment-type Republicans, or is the next president going to be Donald Trump Jr or JD Vance.
‘Upended’ system
“If it’s going to be one of those two, it’s going to be very similar presumably to what we have right now, which means we’re not going to get certainty any time soon.”
Okun, founder and chief executive officer of Singapore-based business advisory firm APAC Advisors and a former Clinton Administration official, said the United States under President Trump had upended the global multilateral trading system that the world had been operating on for the last 80 years.
The shifting dynamics in response to that had seen countries gravitating towards regional trading blocs, something that Pacific countries, including Fiji, should seriously consider, he said.
“We see from the US perspective the desire to have bilateral trade and we see other countries creating plurilateral systems or regional trading blocs . . . ASEAN (Association of Southeast Asian Nations) would be one, CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) is such an agreement, RCEP (Regional Comprehensive Economic Partnership) is another plurilateral system.
“That’s something that I think a country like Fiji should be looking at, same as a country in Southeast Asia — are there blocs that we can be part of and can the Pacific nations come together and collectively get a better agreement with the United States?”
The Fiji Cabinet revealed last week that negotiations were ongoing with the US for a potential US-Fiji Agreement on Reciprocal Trade (ART).
Okun, who came to Fiji at the invitation of the Fiji-USA Business Council, was also sceptical about the August 1 deadline set by President Trump in April for the activation of reciprocal tariffs against about 90 countries, which would mean Fijian exporters of goods into the US would pay 32 percent duty at the border.
Republished from The Fiji Times with permission.
