If anyone doubts that globalization – the defining trend of post-World War II history – has hit a serious roadblock, this morning’s news should convince them otherwise.
First, there is the extraordinary theater of Donald Trump’s trip to Mexico, followed by his doubling down on hardline immigration policies in Arizona. One wonders what President Peña Nieto was thinking when he agreed to meet Trump.
Then there is Tim Cook’s blistering response to the EU’s $14.5 billion tax ruling against Apple, telling the Irish Independent that the ruling was “total political crap” with “no basis in law or fact.” Cook called on the Irish people to stand with him, saying “Ireland is being picked on.”
Protectionist finger-pointing is also on the rise in advance of the G-20 summit in Hangzhou, China, this weekend. The European Union Chamber of Commerce in China has released a report charging that the Chinese are tightening restrictions on investment, even as they move to snap up European companies such as biotech giant Syngenta. China has responded by saying it is the victim of protectionism, not the perpetrator. China and Australia are also exchanging trade allegations.
Writing this morning on Bloomberg View, Mohammed El-Erian says the trend will continue. While G-20 meetings in the past have been an opportunity for nations to reaffirm their commitment to globalization, this time is different. “We should expect a further shift, especially in the short term, away from cross-border integration across regions or within them.”