policy

Economics, by its very scientific formulation, is subject to variables that make it very difficult to formulate exact forecasts over time. Just think of the performance of the real economy, the changing expectations of the operators, the advent of new technologies, the cyclic preferences of consumers who guide the production choices. To this is added the ever-increasing and increasingly worrying uncertainty of the “geopolitical” composition that afflicts the international economic and political scenario, as a consequence of the growing crisis of the free trade system governed by international institutions.
These institutions, established after the Second World War, guaranteed the implementation of many multilateral trade agreements, stipulated in compliance with the laws governing the free market and aimed at the gradual reduction of customs duties. A set of rules also customary, at the base of the economic development of the last 70 years, put today in question by the affirmation, in various parts of the world, of populist and sovranist movements that, among the main objectives, have to protect national productions through the application of customs duties.
These measures inevitably lead to retaliation of various kinds in the economic and commercial field between the various nations, make the assessments of the stock market uncertain and unpredictable and can have serious consequences for the weak economies of some countries. This is the case in these days of Turkey, subject to speculation that led to a heavy devaluation of the lira. Past events of the past teach us how protectionist policies inevitably tend to generate a severe reduction in economic development over the medium term. It is surprising that the US, which has always been a supporter of free trade, are today among the first supporters of protectionist theories. Paladino of the same was made Trump, with an increasingly intense and unpredictable, consistent with the implementation of the electoral program that led him to the White House. His repeated affirmation “America first”, intended to give new impetus to the autochthonous economy through the exclusive protection of national interests, has no regard for international political balances and for the economic and social upheavals that may derive from it. Important international economic treaties such as those with Canada and Mexico have already been put to an end and the intention to replace the various multilateral treaties, many of which the US wanted, with bilateral agreements, has been announced. Functional to this new strategy of trade is the gradual application, in relation to various countries, of protective duties that bring the United States back more than a century. The memory, in fact, goes to the “Smoot-Hawley Act” that in June 1930, in the presence of the effects of the great economic crisis, imposed the protectionist turn, with duties on over 20,000 products. The result was an exacerbation of the same crisis that led to the “great depression” (1930-1933).
Protectionist choices are starting to speak also in Italy, as authoritative representatives of the current government have said they intend to eliminate free trade agreements with Canada (CETA). Fortunately, Europe remains intent on respecting the freedom of trade, which has been one of its raison d’être. This is evidenced by the recent agreement signed with Japan, which eliminates all tariffs between these two important global economic areas. Surprising, however, is how this significant strategic initiative, which contrasts with current trends, has gone almost unnoticed.