GENEVA (Reuters) - U.S. President Donald Trump’s decision to impose steep tariffs on steel and aluminum imports will take a toll on poorer countries and could trigger takeovers in their mining industries, the head of the U.N. trade and development agency UNCTAD said on Thursday.
“They are casualties of the process, but there is very little they can do right now, because developing countries, transition economies, least developed countries are incapable of retaliatory action against the U.S.,” UNCTAD Secretary-General Mukhisa Kituyi told Reuters in Geneva.
Trump pressed ahead with the imposition of 25 percent tariffs on steel imports and 10 percent for aluminum on Thursday but exempted Canada and Mexico, backtracking from earlier pledges of tariffs on all countries.
Kituyi said the announcement would trigger “vulnerabilities and anxieties” and, although the immediate economic impact was small, a trade war triggered by the U.S. tariffs and likely retaliation by other countries would undermine the global trading system and threaten a fragile recovery in commerce.
“Of course, in the developing world there is a multiplier effect as well. The ripple effect is that countries, producers of bauxite or iron ore, will have downward pressures on the value of their commodity,” Kituyi said.
“There will be concentration: bigger companies in the smaller producers will take over the smaller suppliers because of vulnerabilities created by this anxiety,” he said.
Reporting by Tom Miles; Editing by Kevin Liffey