Zoellick warns on Trump protectionism risk
A former Bush administration official and World Bank boss has warned that US President Donald Trump's approach to international trade holds greater risks than current concerns about global security alliances.
Robert Zoellick, the president of the World Bank from 2007 to 2012 and a former official in both Bush administrations, says US protectionist instincts could directly impact some countries' growth prospects and capacity to overcome poverty.
Speaking at the opening of the Diggers and Dealers mining conference in Kalgoorlie, Western Australia, Mr Zoellick said the US had been the leader in world trade for around 70 years.
"If it moves away from that or worse starts to take protectionist actions, it will have a trigger effect," he told the conference on Monday.
Since taking charge in January, President Trump has pulled his country out of the the Trans-Pacific Partnership (TPP) trade group as well as the Paris accord on climate change, and has threatened punitive trade actions against Mexico, Germany, China and Japan.
Mr Zoellick said it would be instructive to see how the Trump administration treats countries that have a trade deficit with the US.
"Economists don't believe bilateral trade deficits are important, but for Trump and Wilbur Ross (US commerce secretary) a trade deficit is like negative net income, its like losing," he said.
"They are very much focused on this. You can see this with countries they have targeted."
Mr Zoellick said he is less concerned on the issue of US security alliances, because the relationships involved have existed for a number of years and careers and decisions have been built around them - making it difficult for one person to change the entire security structure.
"I am a bit more worried about the trade area, or areas like climate change, where the institutions are undeveloped," he said.
Back to Breaking News