Trump’s tariff reprieves leave Pakistan in a bind

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LAHORE: US President Donald Trump’s 70 countries for 90 days offered temporary relief during his presidency and had the implications of far -reaching. Instead of introducing permanent changes in policy, such a short -term suspension increases uncertainty in the global economy.

The 90 -day pause is not a resolution, indicating the recovery. It fuels confusion in businesses about investment decisions, supply chains, and pricing strategies. The Trump administration has become known for sudden and unexpected trade initiatives, which makes investors hesitate, delaying manufacturers’ souring plans and global trade partners to be cautious.

Such unilateral measures also harm the principles of the World Trade Organization (WTO), as a sudden change without multilateral consensus indicates a far -reaching move from trade -based trade.

Although the US China’s trade war may not be inevitable, it has increased more likely due to structural stress. The United States accused China of theft of intellectual property, forced technology transfer, and unfair subsidy – not just imbalance. These deep problems made it difficult to avoid the dispute. Both sides increased the rates, which has no meaningful resolution for years. Even when the talks resumed, mutual distrust has already changed the global trade alignment.

Beyond trade, tension reflects the wider struggle for technical and geographical political dominance, the spread sectors like 5G, semiconductor, and artificial intelligence – all spread in trade policy.

Small and developing countries like Pakistan are often caught in cross -fire. This can be both positive and negative. In the short term, Pakistan can benefit from a trade turning point. Since the United States and China reduce bilateral imports, they can find alternative sources, and Pakistan can emerge as textile, surgical equipment, or agricultural equipment – provided it meets the required standards and delivery timelines.

However, mid -term risks are more serious. The obstacles to global supply chains make multinationals cautious to investment or sourcing from small, less stable economies. Any delay in Chinese exports can directly affect Pakistan’s machinery, chemicals and electronics.

The Pakistani government is actively presenting foreign investment, but the fluctuations in the flow of capital created by Trump’s actions can harm these efforts. During the period of uncertainty globally, investors often transmit capital to safe havens such as US Treasury or gold, which reduces the availability of foreign direct investment and the influx of portfolio for Frontier Markets like Pakistan.

Trade shocks also weaken big currencies such as Chinese yuan. Since volatility has increased the US dollar price, the Pakistani rupee may face further depression. A strong dollar can increase Pakistan’s import bill and fuel inflation, complicate loans payments and pressure economic stability.

If the United States is deeply distributed, countries can eventually have to choose between competitive technical ecosystem-for example, Huawei vs. suppliers in the United States. This can limit access to critical technologies from one side of Pakistan or on the other.

The suspension of Trump’s prices, although developed as relief measures, has increased the global uncertainty globally by indicating temporary and illegal trade policy -making. The US conflict, which has now entered, looks long -term. For countries like Pakistan, both developing commercial landscape risks – such as supply flights and capital flights – and trade turns and potential opportunities in the form of competitive labor force. The extent to which Pakistan navigates these shifts will depend on timely and strategic policy making.