Daily Management Review

Global CFOs Says Fear Of An Imminent Trade War With Germany Sparked By Trump's Blunt Language


06/26/2017




Global CFOs Says Fear Of An Imminent Trade War With Germany Sparked By Trump's Blunt Language
According to a new survey conducted by CNBC, fears that a trade war could be forthcoming has been ignited by a war of words between U.S. President Donald Trump and German Chancellor Angela Merkel in recent weeks.
 
As stark differences regarding climate, trade and defense have bubbled to the surface, they were largely troubled by the strained relationship between Washington and Berlin, said chief financial officers (CFOs) from some of the world's biggest firms.
 
With the tense atmosphere that has developed between the U.S. and Germany, they were either "somewhat concerned" or "very concerned", said over 64 percent of global CFOs – across a wide range of industries.
 
However, they were "not at all concerned" that the Trump administration's policies and rhetoric toward Berlin would lead to a trade war, said 30.8 percent of respondents. They did not know whether the latest political developments should be a cause for concern, said just over 5 percent pf the respondents.
 
Collectively managing more than $4 trillion in market capitalization across a wide variety of sectors, and some of the largest public and private companies in the world are part of the CNBC Global CFO Council.
 
Trump reportedly described Germany's trade policies with the U.S. as "bad, very bad” at a meeting with EU officials at the end of May. Insisting German imports have damaged the U.S. manufacturing industry, Trump has long voiced his frustrations with Germany's trade surplus with the U.S., even though the White House moved to dismiss these media reports.
 
Trump threated to slap a 35 percent tax on German auto imports in January,
 
"If you want to build cars in the world, then I wish you all the best. You can build cars for the United States, but for every car that comes to the USA, you will pay 35 percent tax," he said in an interview with German newspaper Bild.
 
Appearing next to German born U.S. diplomat Henry Kissinger, Merkel responded to Trump's criticism on Wednesday. For both countries, the transatlantic relationship was more about "balancing interests (and) achieving a win-win situation", she said.
 
One year on from the U.K.'s vote to leave the European Union, whether they were now more optimistic or pessimistic regarding the outcome of Brexit  was also a question that was put to the respondents of the CNBC Global CFO Survey.
 
They were either "more optimistic" or "a lot more optimistic" about a Brexit resolution 12 months on from the vote, said more than one-third of global CFOs.
 
Conversely, with more than 40 percent of respondents saying they were either unsure or their view had not changed since June 23 2016, 23.1 percent said they had become "more pessimistic" over the outcome of Brexit.
 
U.K. and the EU kicked off official Brexit talks on Monday.
 
EU leaders appear to have gained renewed confidence since pro-Europe Emmanuel Macron's victory in the French poll last month despite British Prime Minister Theresa May's disappointing election result at the start of June.
 
The EU is "slowly turning the corner", said Donald Tusk, president of the European Council.
 
(Source:www.cnbc.com) 






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