A recent study by risk consultancy Verisk Maplecroft finds that major emerging economies—including China, Brazil, and India—have the capacity to realign their trade strategies to withstand the economic impact of U.S. tariffs. This raises questions on the effectiveness of tariff policies in influencing these nations’ trade flows.
According to a new report by Verisk Maplecroft, most leading emerging economies have demonstrated robust adaptability to U.S. tariffs imposed in recent years. Countries like China, Brazil, and India possess diversified trade networks and flexible supply chain strategies, enabling them to pivot and mitigate tariff impacts without sustaining excessive economic damage.
The report highlights that these nations are actively realigning trade routes, sourcing alternatives for inputs, and intensifying intra-regional trade partnerships. This trade realignment reduces their dependency on the U.S. market and helps sustain export growth despite protectionist trade measures.
Key highlights include:
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Emerging economies exhibit strong resilience due to diversified export markets and flexible supply chains
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Realignment efforts include boosting trade with regional partners and tapping new markets beyond the U.S.
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Tariff effectiveness as a trade tool is diminished as targeted nations innovate to circumvent restrictions
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Some countries, including India, have launched proactive export missions and financial support schemes to aid exporters facing tariff hurdles
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The trend underscores a shifting global trade landscape where multilateral cooperation and regionalism gain importance
The findings suggest that unilateral tariff increases may no longer be as potent in influencing the trade balance of emerging economies, emphasizing the need for nuanced and multilateral trade negotiations.
Sources: Reuters, Verisk Maplecroft report, Indian Express, Economic Times