Source: Global Times  Published: 2025-04-30

By Global Times

Marcos Cordeiro Pires

Professor of international political economy at Sao Paulo State University

Editor's Note:

The US government's escalating tariff war has fueled global concern. By weaponizing tariffs and resorting to protectionism, Washington not only jeopardizes global supply chains but also risks inflicting damage on its own economy. As concern mounts over the stability of the international trade system, Marcos Cordeiro Pires (Pires), professor of international political economy at São Paulo State University, stated in a recent exclusive interview with the Global Times (GT) reporter in Brazil Chen Yiming that the trade protectionist measures pursued by the US government will ultimately result in the country gradually losing its competitive edge in the global economy.

"Trade protectionism will, in the long run, undermine the US' competitiveness on the global stage," said Pires. "At a time when the US is embracing protectionism and adopting beggar-thy-neighbor policies, China and other countries in the Global South are stepping into a window of new opportunities," he added.


GT: In 1930, the US enacted the Smoot-Hawley Tariff Act, leading to retaliatory tariffs from other countries and triggering a global trade war. What were the motivations and consequences of this act, and what warnings does it offer for today's world?

Pires: The original intent of the Smoot-Hawley Tariff Act in 1930 was to protect domestic industries from the shocks of the 1929 Great Depression. US lawmakers believed that sharply increasing tariffs would shield American agricultural and industrial products. However, this protectionist policy backfired. It triggered a chain reaction worldwide, with many countries imposing retaliatory tariffs. Within two years, global trade volume plummeted by around 60 percent, further contracting the world economy. The Act not only failed to save the US economy but also deepened the global economic crisis, indirectly contributing to more severe international conflicts later on.

GT: Protectionist policies may seem to safeguard domestic industries in the short term, how do unilateralism and protectionism negatively impact national economies and global growth over the long term?

Pires: Protectionism may offer short-term shelter to specific industries, but over time it weakens real competitiveness. It raises production and consumption costs, reduces incentives for innovation, and blocks the free flow of capital, technology, and talent. Eventually, it causes domestic industries to lose their global edge and become more fragile. Historically, there has never been a true winner in a trade war - it weakens the global economy and severely harms the initiators themselves.

GT: In the current era of profound economic globalization, the US has sharply increased tariffs once more, seemingly disregarding historical lessons. What is the essence of this unilateral move? Is the US really "losing" in global trade?


Pires: The US trade deficit is largely the result of global division of labor and consumption patterns. As the issuer of the world's reserve currency, the US consumes far more than it exports and sits at the center of global supply chains - deriving substantial benefits. The trade war is essentially a political tool. In reality, ordinary American consumers and companies across global supply chains suffer the most.

GT: By employing tariffs as a coercive instrument, is the US risking a new global trade war? What are the potential short- and long-term ramifications for both the US and the international community? Is a trade war today more damaging than a century ago?

Pires: Yes, the risk is very real. Trade wars between major economies are not just bilateral issues - they shake the entire global economic structure. In the short term, they directly increase the cost of international trade, dampen business investment, and heighten global economic uncertainty. In the long term, they may lead to supply chain restructuring, the emergence of rival economic blocs, and a decline in overall productivity. Given today's deeply interconnected global economy, with supply chains spanning many countries, the consequences of a trade war are undoubtedly more severe than in the 1930s.

GT: The US' utilization of tariffs as an economic weapon has attracted widespread criticism.. Why do we say that trade wars have no winners, and protectionism leads nowhere?

Pires: Trade wars impose higher costs on businesses, higher prices on consumers, and lower growth for entire economies. So-called "protection" cannot truly protect domestic industries or consumers. What it leads to is long-term erosion of competitiveness. Trade wars are fundamentally lose-lose, or even lose-lose-lose scenarios. Protectionism offers no way out.

GT: Was the General Agreement on Tariffs and Trade (GATT), implemented in 1948, a direct response to the 1930s global trade war? How has the World Trade Organization (WTO) enhanced upon GATT in regulating global trade? What role has the multilateral trading system played in averting trade wars?


Pires: Yes, the GATT was a direct response to the painful lessons of the 1930s trade wars. It reflected the international consensus that going it alone leads to mutual harm, and that cooperation is essential. The WTO, as a successor and upgrade to GATT, goes beyond goods - it also covers services, intellectual property, and features a more effective dispute resolution mechanism. The WTO has significantly reduced global trade frictions, stabilized the international economic order, and provided vital support especially for smaller economies.

GT: How does the multilateral trading system foster global development through mutually advantageous cooperation? Based on the WTO's evolution, what benefits has it brought to developing and developed countries alike?

Pires: History and experience show that openness and cooperation are the only paths to prosperity. The multilateral trading system, by providing rules-based certainty, enables countries to leverage their comparative advantages for mutual benefit. Developing countries have spurred growth through exports, while developed countries benefit from investment and technology flows. For example, many Asian and Latin American nations achieved decades of rapid growth and lifted hundreds of millions out of poverty under a stable multilateral trade framework.


GT: How has the US, once a principal architect and significant beneficiary of the multilateral trading system, become its primary disruptor? How should other countries respond to safeguard multilateralism and promote free trade and common development?

Pires: This shift stems from changes in US domestic politics and the shifting global balance of power. As the US finds itself losing its absolute edge in certain fields, it turns to unilateral and protectionist approaches to reshape the rules. In response, other countries should support WTO reform, enhance the representation and voice of developing nations in global governance, and promote regional trade agreements to sustain openness and cooperation.


GT: In the current global landscape, why is China's dedication to high-level opening-up and its defense of the multilateral trading system so vital?

Pires: As the world's second-largest economy, China's firm commitment to opening up and defending multilateralism benefits not only its own transformation and upgrading, but also sends a strong and positive signal to the world. At a time when protectionism is on the rise, China's proactive participation in global economic governance helps stabilize the international trading system and inject much-needed certainty and momentum into the global economy.