U.S. Economy Remains Steady Despite New Steel & Aluminum Tariffs

NKF Senior Managing Director, Gregg Wassmansdorf, recently authored his latest column for fDi Magazine. In this opinion piece, Mr. Wassmansdorf ponders the consequences to foreign direct investment following newly enacted U.S. tariffs on aluminum imports from Canada, Mexico, and the European Union (aside from befuddling longtime U.S. allies and the world at large).

Excerpt below.

“I travel a lot as a corporate site selector, so an airplane analogy comes readily to mind when thinking about recent US economic policy. Planes can still take off and fly when air is turbulent, but it doesn’t necessarily mean a comfortable flight. So, it is with the US economy, which shows strong growth, low unemployment, continuing FDI attraction and early signs of capital repatriation.

Indeed, the US recently topped the AT Kearney Foreign Direct Investment Confidence Index for the sixth year in a row. Yet despite these strengths, the US lurches back, forth, and sideways with its policy pronouncements – and has now instigated trade wars that are creating widespread discomfort.

The US has announced a 25% tariff on steel and a 10% tariff on aluminum imported from Canada, Mexico, Japan and the EU. If this is meant to be leverage in the NAFTA renegotiations, why include the EU and Japan? If it’s about creating 'fair trade', why target Canada, which is the largest source of imported steel and aluminum for the Americans, but which nevertheless has a trade deficit with the US for these metal products? For anyone doing business in or with the US now, it can be difficult to decide how to proceed.”

Read the full article, The View from Americas: US Self-inflicted Turbulence Can’t Shake Economy Off Course.  

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