00:00The Trump administration is slapping higher tariffs on nearly every major trading partner,
00:06from China to the European Union.
00:08The White House says it's about protecting American industries.
00:12But could the US end up paying the price?
00:15Joseph Charan from Asia's School of Business says the economic fallout may hit sooner than expected.
00:21When you don't have that free trade and the glorious economic trading that is free of barriers,
00:33you need to form blocks, okay?
00:34You'll need to start trading their favorite partner and stuff like that.
00:38But coming back, is it temporary?
00:39I think it's temporary because the one who's going to get most affected by this is the one imposing the tariffs.
00:46As soon as they start hitting a recession, as soon as the price of goods go up in their territory,
00:52because of this tariffs, it's going to happen.
00:54Mark my words, it will happen.
00:56Can I get your sense of when would that happen?
00:58My sense is probably if it does happen, if we don't reverse course, first quarter of 2026,
01:04that's when inflation will start creeping up.
01:06You know, I listen to some pundits saying, oh, no inflation.
01:08So far the ground in America, mid-term level, is all okay, stable.
01:13No, they're living off inventories.
01:14Wait and see.
01:16The prices are bound to go up.
01:17There's no way it's not going to go up.
01:19So once inflation hits the heartlands of America, and once recession starts creeping in,
01:25they're going to ask, what is going on here?
01:27And that's when you'll see the pullback.
01:30Everyone's politically astute.
01:32It's going to be the politics driving them into the tariffs,
01:35and it's going to take them out of tariffs too.
01:37So what does this mean for businesses, especially here in Asia?
01:40How can they prepare for Trump's tariff escalation, even if it turns out to be temporary?
01:46You've got to play along with the blocks.
01:49That means if your country is part of a big regional block, take advantage of that.
01:53If the government is giving you financial enterprise solutions and financing,
01:59take advantage of that.
02:00Take whatever comes, because you'll need all the help you can get.
02:03So my view is take whatever you can.
02:05Go with the trade blocks.
02:08If you can, or even diversify.
02:10Come back to your question of diversification.
02:12If I'm a tire maker and I've got no operations in America, I do send tires to America,
02:19I'll get hit by the tariffs, correct?
02:21So what do I do?
02:23Do you start building a factory in America?
02:25Not necessary.
02:26If you want to, if it makes business sense, do it.
02:29Don't do it because it's a temporary measure, because you know it's going to go away.
02:33Those who don't have the flexibility, don't jump and say, I'm going to do factories here,
02:36I'm going to do factories.
02:37Think carefully about the long-term solution.
02:40What if I do it in America?
02:41How does it affect the other parts of the business?
02:44Can I use financial markets to hedge against those kind of situations?
02:49So you have to be a bit more flexible in your thinking as well,
02:52because you don't have to completely change the way you do your operations
02:56just because of some temporary blip in the economic trading system.
03:01But that's it.
03:02If you have operations in America, ramp it up.
03:05It'll help your case.
03:06But that's it.
03:09How does it affect the South America?
03:09Four of three of us.
03:10Can I use an architect on Gianna Ricciotto?
03:11Does it affect the South America?
03:11Yeah.
03:12How does it affect the South America?
03:13Of course.
03:13You.
03:14How do we do it in America?
03:15You 10% change it.
03:15I do.
03:16How do I feel?
03:16There I feel.
03:30Nations 1
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