Mario Draghi, the president of the European Central Bank (ECB), and Christine Lagarde, the managing director of the International Monetary Fund (IMF), have warned that the global trade dispute between the US and China as well as a threatened dispute with Europe and other industrial nations could cause headwinds for all and could get worse, CNBC reported.
“Global growth has been subdued for more than six years and the largest economies in the world are putting up, or threatening to put up, new trade barriers,” IMF’s Lagarde said. “And this might be the beginning of something else, which might affect us all in a more broad way.”
Lagarde and Draghi said the threat of US import tariffs (on Europe) meant that some European countries that are centers of European car production—Czech Republic, Slovakia, Poland and Romania—could be particularly vulnerable.
“Global trade has faced headwinds in recent years as trade-restrictive measures have outpaced liberalizing measures,” Draghi said. “The main long-term challenge is moving towards a more balanced growth and financing model, which is more reliant on domestic innovation and on higher investment spending.”