Currency exchange rates have affected the terms of international trade since the beginning of floating exchange rates, and for nearly as long, politicians have accused trading partners of manipulating exchange rates to gain an unfair advantage. What does it mean to engage in “currency manipulation,” how do governments determine whether and when it happens, and what can be done about it?
If the Trump Administration is serious about applying a 20 percent tariff on goods from Mexico to pay for new construction on a wall along the United States and Mexico, it’s the United States that will pay, not Mexico. And the bill could come in as much as 900% above cost.
Countries often use a variety of tactics to give their home-grown companies a leg up over foreign competitors, like requiring “skirts” on lawnmowers of competitors. These are non-tariff barriers.