President Joe Biden has slapped major new tariffs on Chinese electric vehicles, advanced batteries, solar cells, steel, aluminium and medical equipment, taking potshots at Donald Trump along the way as he embraced a strategy that’s increasing friction between the world’s two largest economies.
The Democratic president said on Tuesday that Chinese government subsidies ensure the nation’s companies do not have to turn a profit, giving them an unfair advantage in global trade.
“American workers can outwork and outcompete anyone as long as the competition is fair,” Biden said in the White House Rose Garden. “But for too long, it hasn’t been fair. For years, the Chinese government has poured state money into Chinese companies … it’s not competition, it’s cheating.”
China immediately promised retaliation. Its Ministry of Commerce said Beijing was opposed to the tariff hikes by the United States and would take measures to defend its interests.
Biden will keep tariffs put in place by his Republican predecessor Donald Trump while ratcheting up others, including a quadrupling of EV duties to more than 100 percent and doubling the duties on semiconductor tariffs to 50 percent.
The new measures affect $18bn in imported Chinese goods including steel and aluminium, semiconductors, electric vehicles, critical minerals, solar cells and cranes, the White House said. The EV figure, while headline-grabbing, may have more political than practical impact in the US, which imports very few Chinese EVs.
The US imported $427bn in goods from China in 2023 and exported $148bn to the world’s number-two economy, according to the US Census Bureau, a trade gap that has persisted for decades and become an ever more sensitive subject in Washington.
US Trade Representative Katherine Tai said the revised tariffs were justified because China was stealing US intellectual property. But Tai recommended tariff exclusions for hundreds of industrial machinery import categories from China, including 19 for solar product manufacturing equipment.
The tariffs come in the middle of a heated campaign between Biden and Trump, his Republican predecessor, to show who’s tougher on China.
Asked to respond to Trump’s comments that China was eating the US’s lunch, Biden said of his rival, “He’s been feeding them a long time.” The Democrat said Trump had failed to crack down on Chinese trade abuses as he had pledged he would do during his presidency.
Karoline Leavitt, the Trump campaign’s press secretary, called the new tariffs a “weak and futile attempt” to distract from Biden’s own support for EVs in the United States, which Trump says will lead to layoffs at car factories.
Administration officials said their measures are combined with domestic investment in key industries and unlikely to worsen a bout of inflation that has already angered US voters.
Trade tariff
Biden has struggled to convince voters of the efficacy of his economic policies despite a backdrop of low unemployment and above-trend economic growth. A Reuters/Ipsos poll last month showed Trump had a seven percentage-point edge over Biden on the economy.
China’s BYD overtook Tesla as the biggest seller of electric vehicles [File: VCG/VCG via Getty Images]
Analysts have warned that a trade tiff could raise costs for EVs overall, hurting Biden’s climate goals and his aim to create manufacturing jobs.
Biden has said he wants to win this era of competition with China but not to launch a trade war. He has worked in recent months to ease tensions in one-on-one talks with Chinese President Xi Jinping.
Both 2024 US presidential candidates have departed from the free-trade consensus that once reigned in Washington, a period capped by China’s joining the World Trade Organization in 2001. Trump’s broader imposition of tariffs during his 2017-2021 presidency kicked off a tariff war with China.
As part of the long-awaited tariff update, Biden will increase tariffs this year from 25 percent to 100 percent on EVs, bringing total duties to 102.5 percent, from 7.5 percent to 25 percent on lithium-ion EV batteries and other battery parts and from 25 percent to 50 percent on photovoltaic cells used to make solar panels. Some critical minerals will have their tariffs raised from nothing to 25 percent.
More tariffs will follow in 2025 and 2026 on semiconductors, as well as lithium-ion batteries that are not used in electric vehicles, graphite and permanent magnets, as well as rubber medical and surgical gloves.
A number of lawmakers have called for massive hikes on Chinese vehicle tariffs or an outright ban over data privacy concerns. There are relatively few Chinese-made light-duty vehicles being imported now.
The United Auto Workers, a politically important union that endorsed Biden, said the tariff moves would ensure that “the transition to electric vehicles is a just transition.”
Chinese President Xi Jinping has concluded a five-day tour of Europe, after visiting France, Serbia and Hungary, where he touted Beijing’s vision of a multipolar world and held talks on trade, investments and Russia’s war in Ukraine.
In France, President Emmanuel Macron feted Xi with gifts of luxury bottles of cognac and a trip to a childhood haunt in the Pyrenees mountains, while in Serbia, President Aleksandar Vucic organised a grand welcome, gathering a crowd of tens of thousands of people, who chanted “China, China” and waved Chinese flags in front of the Serbian presidential palace.
In Hungary, President Tamas Sulyok and Prime Minister Viktor Orban also rolled out the red carpet for Xi, receiving him with military honours at the Hungarian presidential palace.
The tour marked Xi’s first trip to Europe in five years and came at a symbolic time for the three nations.
This year marks the 60th anniversary of diplomatic relations between China and France, and the 75th of those with Hungary. The trip also coincided with the 25th anniversary of the NATO bombing of the Chinese embassy in Belgrade during Serbia’s war on Kosovo.
Xi’s main aim with the visit, analysts say, was pushing for a world where the United States is less dominant, and controlling damage to China’s ties with the European Union as trade tensions grow amid a threat of European tariffs and a probe into Chinese subsidies for electric vehicles that European officials say are hurting local industries.
People waving Chinese and Serbian flags gathered outside the Palace of Serbia during a welcome ceremony for Chinese President Xi Jinping in Belgrade [Dimitrije Goll/ Serbia’s Presidential press service via AFP]
Here are the main takeaways.
No concessions on trade, Russia-Ukraine
Throughout Xi’s two-day trip to France, Macron pressed the Chinese leader to address Beijing’s trade imbalances with the EU – which stood at a deficit of 292 billion euros ($314.72bn) last year – and to use his influence on Russian President Vladimir Putin to end the war in Ukraine.
Macron invited European Commission President Ursula von der Leyen to join his talks with Xi, to underline European unity on calls for greater access to the Chinese market and to address the bloc’s complaints regarding its excess capacity in electric vehicles and green technology. The pair also pushed Xi to control the sales of products and technologies to Russia that can be used for both civilian and military purposes.
But the Chinese leader appeared to have offered few concessions.
Xi denied there was a Chinese “overcapacity problem” and only reiterated his calls for negotiations to end the war between Russia and Ukraine. Xi, who is expected to host Putin in China later this month, said he called on all parties to restart contact and dialogue.
“Both trade and Russia are non-negotiable for China. Macron could not achieve anything [on those fronts],” said Shirley Yu, political economist and senior fellow at the London School of Economics in the United Kingdom.
But she suggested the visit furthered Macron’s personal relationship with Xi, one that is part of the French leader’s strategy to make France a crucial partner to all emerging world powers.
“Macron shares one vision in common with Xi, which is that the US hegemony – including the quest for Europe’s allegiance to the US’s foreign policy – must yield to a multipolar global order by accommodating the rising powers’ interests and concerns,” Yu told Al Jazeera. Macron’s recent visits to India and Brazil also “prove that France wants to stay at the forefront of that global shift,” she added.
And despite the lack of concessions, French officials told the Reuters news agency that the visit allowed Macron to pass on messages on Ukraine and would allow for more open discussions in the future.
As for Xi, Macron’s talk of European “strategic autonomy” helps further the Chinese leader’s vision for a multipolar world. And while there was no reconciliation on the economic front, Xi’s visit would help with “damage limitation” wrote Yu Jie, a senior research fellow on China at the Chatham House, a United Kingdom-based think tank. It could help prevent ties with Europe from worsening even more, as they have with the US, she said, amid the threat of European tariffs on Chinese goods and a probe into Chinese subsidies for electric vehicles.
Chinese President Xi Jinping, left, and Hungarian Prime Minister Viktor Orban, right, address the press after their official talks in the Carmelite Monastery, the prime minister’s office, at Buda Castle district in Budapest, Hungary on May 9, 2024 [Pool via AFP]
In contrast to Xi’s stop in France, his visits to EU candidate country Serbia and EU member state Hungary were marked by pledges to deepen political ties and expand investments in eastern and central Europe.
In Belgrade, Vucic, the Serbian president, signed up to Xi’s vision of a “global community of shared future” and the two leaders hailed an “ironclad partnership” while also announcing that a free trade deal signed between their two countries last year would come into effect on July 1.
Other economic promises included the purchases of new Chinese trains, new air links and increased Serbian imports.
Yu, the political economist at LSE, said Xi’s visit to Belgrade on the 25th anniversary of NATO’s bombing of the Chinese embassy in the city, was meant to make “clear that China and Russia share a common objection to NATO’s east expansion”. It also “reveals that there should be no illusion that China will bow down to Western pressure to curtail economic partnership with Russia,” she said.
In Budapest, Xi pledged more investments in transport and energy, including the construction of a high-speed railway connecting the capital city centre to its airport and cooperation in the nuclear sector, according to Hungarian officials. Xi also promised to move forward on a $2.1bn project to connect the Hungarian capital with the Serbian capital.
The project, most of which is financed by a loan from China, is part of the Belt and Road Initiative, the ambitious infrastructure plan launched by Xi a decade ago to connect Asia with Africa and Europe.
All this demonstrates Xi’s keenness “to reintroduce the Cold War ‘Second World’ as a significant geostrategic player,” said Yu. “With China’s economic support, the periphery of the EU can become more significant European economic players, boasting higher speed of growth and delivering high-tech supply chains,” she said.
To China, Hungary serves as a gateway to the EU trade bloc and Yu added that Beijing’s growing partnership with Hungary could also “potentially deem the EU’s sanctions on Chinese EVs ineffective”.
Chinese President Xi Jinping set to hold talks with Ursula von der Leyen and French President Emmanuel Macron in Paris.
European Union chief Ursula von der Leyen has said she will push for competition with China that is “fair and not distorted” in talks with Chinese President Xi Jinping.
“I have made clear that the current imbalances in market access are not sustainable and need to be addressed,” von der Leyen, who is the president of the EU Commission, said hours ahead of a meeting between her, Xi and French President Emmanuel Macron in Paris.
Xi on Sunday began a three-country tour of Europe as EU officials are probing the trade practices of Chinese firms operating in the bloc.
The European Commission last week opened an investigation to determine if European suppliers of medical devices are given fair market access in China.
The inquiry follows similar probes into Chinese wind turbine suppliers and Chinese subsidies for solar panels, electric vehicles (EVs) and trains.
European carmakers such as Volkswagen and Renault are losing ground to Chinese electric vehicle makers, which have received billions of dollars worth of state subsidies in recent years.
EU officials are also concerned about Chinese spying and Beijing’s military cooperation with Russia as Moscow prosecutes its war on Ukraine.
Von der Leyen on Sunday reiterated the bloc’s position that it should “derisk” ties with China but not decouple from the world’s second-largest economy, in contrast with Washington’s aggressive moves to shut out key Chinese industries entirely.
“We have been very clear-eyed about our relationship with China, which is one of the most complex, but also one of the most important,” she said.
But Von der Leyen said the EU could not accept “market-distorting practices”.
“China is currently manufacturing, with massive subsidies, more than it is selling due to its own weak domestic demand. This is leading to an oversupply of Chinese subsidised goods, such as EVs and steel, that is leading to unfair trade,” she said.
Von der Leyen said she would encourage Xi to address “overcapacities” in the short term.
Xi’s visit is seen as a test of the EU’s efforts to walk a fine line between Beijing and Washington, with the Chinese leader widely expected to attempt to exploit divisions between Western allies.
While European leaders have qualms about Beijing’s growing power and influence, the bloc is divided over how to respond to the heated US-China rivalry.
Macron, who is treating Xi to the formal honours of a full state visit, has often warned against Europe becoming a US vassal and is widely seen to be attempting to forge a third way in geopolitical relations.
“In Europe, we are not unanimous on the subject because certain players still see China as essentially a market of opportunities,” Macron said in an interview with French newspaper La Tribune ahead of Xi’s visit.
After a two-day visit to France, Xi will travel to Serbia and Hungary, both of which are seen as friendly with Beijing.
Turkey says the ban will stay in place until Israel agrees to a permanent ceasefire in Gaza.
For years, Israel and Turkey have been crucial trade partners.
It was a commercial relationship worth nearly seven billion dollar a year. But Israel’s war on Gaza changed all that.
The Turkish government has been demanding a halt to the violence that’s killed nearly 35,000 Palestinians in seven months
And the Turkish president condemned Israel’s decision to block its aid meant for Gaza last month. Recep Tayyip Erdogan has now announced a total trade ban until Israel agrees to a ceasefire.
But has he acted under domestic pressure, after a setback in local elections was blamed partly on the country continuing to do business with Israel? And how will this affect the economies of both sides?
Presenter: Neave Barker
Guests:
Vehbi Baysan – Political analyst and assistant professor at İbn Haldun University
Gideon Levy – Author and columnist at Haaretz
Vladimir Vano – Chief economist at international think tank, GLOBSEC
Bangkok, Thailand – Singapore has responded to United Nations pressure by cracking down on sales of weapons through its territory to Myanmar, delivering a serious blow to the embattled generals, who seized power in a coup more than three years ago.
Thomas Andrews, the UN special rapporteur on the human rights situation in Myanmar, told Al Jazeera that the city state’s government “immediately responded” to his 2023 report that found Singapore-based entities had become the third largest source of weapons materials to the military and were “critical” to its weapons procurement.
“My subsequent report to the Human Rights Council found that exports of weapons materials from Singapore to Myanmar had dropped by 83 percent,” Andrews said. “This is a significant step forward and an example of how governments can make a difference for those who are in harm’s way in Myanmar.”
Singapore’s crackdown has raised costs for army chief Min Aung Hlaing and his forces at a time when they are facing unprecedented battlefield disasters – struggling to quell opposition against their rule in the country’s heartland, and failing to push back against a coalition of ethnic minority and majority Bamar resistance forces that have forced the military out of territory bordering Thailand, China and India.
In what analysts see as a sign of the generals’ increasing desperation, they have imposed a sweeping conscription law in a bid to boost their ranks.
Senior General Min Aung Hlaing, who led the February 2021 coup, presided over last month’s Armed Forces Day with the military under unprecedented pressure [Aung Shine Oo/AP Photo]
Andrews’s 2023 report, The Billion Dollar Death Trade, provided details of more than $1bn of transfers of arms and related materials to Myanmar’s ruling generals, officially styled as the State Administration Council (SAC). The report revealed that 138 Singapore-based firms were involved in the transfer of $254m in weapons materials to the SAC from 2021 to 2022. It did not name the companies, unlike the sections on China, Russia and India.
In response, the spokesperson of Singapore’s Ministry of Foreign Affairs said the government appreciated Andrews’s efforts “to provide information to aid Singapore’s investigations into whether any offences were committed under Singapore law”.
It added that the country had taken a “principled position against the Myanmar military’s use of lethal force against unarmed civilians and has worked to prevent the flow of arms into Myanmar”.
At least 4,882 civilians have been killed, according to the Assistance Association for Political Prisoners, which has been tracking the toll, and the military has been accused of war crimes in its use of air power and attacks on civilians.
“Singapore has been quietly tightening the screws on Myanmar,” said Zachary Abuza, a professor at the National War College in Washington, DC. “While there’s more they could do, Singapore deserves a lot of credit for quietly bringing the pressure on the military government in the past year.
“For decades, Singapore was the primary financial conduit for Myanmar. It is a much less permissive environment for the junta and their cronies today, forcing them to reroute their transactions through different jurisdictions. It doesn’t stop the financial flows, but it imposes new costs.”
Power to disrupt
In his recent follow-up report to the UN Human Rights Council, Andrews noted that there was no evidence that the Singaporean government had any knowledge of the transfers that were taking place.
Russia remains a major supplier of military equipment, including jet fighters, to Myanmar [File: AFP]
He also described how, after the 2023 findings were published, and following diplomatic efforts, the Singapore government launched an investigation into the findings and welcomed Andrews to the city-state, where he provided further information to assist with the investigation.
After the US imposed sanctions on 21 June 2023 on Myanma Foreign Trade Bank and the Myanma Investment and Commercial Bank, the Monetary Authority of Singapore also gave the green light to UOB and other Singapore banks to stop servicing Myanmar-linked accounts.
Myanmar’s National Unity Government (NUG), established by lawmakers from Aung San Suu Kyi’s ruling National League for Democracy, who were overthrown in the coup, said Singapore’s intervention had significantly curtailed the generals’ procurement abilities.
“Singapore’s actions have highlighted the power that ASEAN members possess to disrupt the Myanmar military junta’s acts of terrorism against its own people by cutting off their access to weapons, finance, and legitimacy,” said NUG cabinet minister, Sasa.
“Every bullet and dollar provided to the junta translates into more death, destruction, pain and suffering for the people of Myanmar.”
Sasa called on other countries within the 10-member Association of Southeast Asian Nations (ASEAN) to help end Myanmar’s “reign of terror” and stressed that removing the generals from power would benefit the stability and prosperity not only of the region but the world.
“The catastrophic crisis created by the junta in Myanmar has already spilled across international borders, impacting ASEAN and our neighbouring countries. If the junta proceeds with its forced conscription laws, it will only exacerbate the crisis, leading to further instability in the region,” the minister told Al Jazeera.
The military regime is currently under immense pressure following advances by anti-coup forces that have seen it lose hundreds of military outposts in northern states and several key towns along the Chinese border, as well as in western Rakhine state.
An alliance of ethnic Karen and anti-coup fighters has also forced the military into a retreat from the strategically important town of Myawaddy on the Thai border.
More than 2.5 million people have fled conflict and insecurity as a result of the coup [File: Sakchai Lalit/AP Photo]
Russia and China continue to be the military’s main source of advanced weapons systems accounting for more than $400m and $260m, respectively, since the coup, according to Andrews’s 2023 report. During Armed Forces Day last month, Alexander Fomin, Russia’s deputy defence minister, was again guest of honour, as many countries chose to boycott the occasion.
To further crack down, Al Jazeera understands that Andrews is examining the ways in which the SAC accesses the global finance system to repatriate foreign revenues and procure weapons.
Regional action needed
The humanitarian crisis triggered by the coup – more than 2.5 million people have fled conflict and insecurity since February 2021, according to UN estimates – has put growing pressure on Southeast Asian countries over their failure to effectively respond to the crisis or restrain Min Aung Hlaing.
ASEAN, which Myanmar joined in 1997, has been split between countries wanting to take a tougher line, including Singapore, and those calling for engagement, such as Cambodia.
Thailand’s Prime Minister Srettha Thavisin this week told the Reuters news agency that as the SAC was “losing strength”, it was a good time to open talks with Myanmar.
The Thai leader’s intervention came as it emerged that Thailand had allowed the military to fly home government officials, military officers and their families who had abandoned Myawaddy via Thailand.
Increasingly embattled and isolated, the SAC has begun mandatory military conscription amid battlefield casualties and reports of desertions.
Security analyst Anthony Davis wrote recently that the army “almost certainly numbers around 70,000 troops supported by militarised police and militia units organised under a unified command structure”.
Activist group Justice for Myanmar urged Singapore to speed up prosecutions to hold Myanmar military arms brokers to account for breaching export controls and to deter others seeking to profit from the trade, wherever they might be.
“We welcome the steps Singapore has taken to disrupt the junta’s arms brokers, but the government needs to do far more to block the junta’s access to funds, arms, equipment and jet fuel. It is unacceptable that there are notorious Myanmar cronies still operating and even living in Singapore and Singapore has still not imposed any sanctions on the junta and its businesses, in contrast with the sanctions imposed on Russia [over Ukraine],” the group’s spokesperson Yadanar Maung said.
But even as the Singapore route is squeezed, Maung worries dealers are finding alternative shipping routes.
One such country might be Thailand. Andrews’s report noted how entities operating there had already been involved in shipping spare parts for advanced weapons systems, raw materials and manufacturing equipment for the SAC’s weapons factories.
“There are signs that Thailand is an increasingly popular destination for cronies and arms brokers, which will no doubt continue in the absence of coordinated international action against the junta,” Maung told Al Jazeera.
Al Jazeera has contacted the Singapore embassy in Yangon for comment.
US Treasury Secretary Janet Yellen and her team are leaving China and returning to the United States after trying to tackle the major questions of the day between the countries.
Here’s a look at what she tried to accomplish, what was achieved and where things stand for the world’s two largest economies:
Unfair trade practices
Yellen said she wanted to go into the US-China talks to address a major complaint of the administration of US President Joe Biden – that Beijing’s economic model and trade practices put US companies and workers at an unfair competitive disadvantage by producing highly subsidised solar products, electric vehicles and lithium-ion batteries at a loss, dominating the global market.
Chinese government subsidies and other policy support have encouraged solar panel and electric vehicle (EV) makers in China to invest in factories, building far more production capacity than the domestic market can absorb.
She calls this “overcapacity”.
Throughout the week of meetings, she talked about the risks that come from one nation maintaining nearly all production capacity in these industries, the threat it poses to other nations’ industries and how a massive rapid increase in exports from one country can have big impacts on the global economy.
Ultimately, the two sides agreed to hold “intensive exchanges” on more balanced economic growth, according to a US statement issued after Yellen and Chinese Vice Premier He Lifeng held extended meetings over two days in the southern city of Guangzhou.
It was not immediately clear when and where these exchanges would take place.
“It’s not going to be solved in an afternoon or a month but I think they have heard that this is an important issue to us,” she said.
Money laundering and related crimes
After several rounds of meetings, the US Treasury and the Chinese Central Bank agreed to work together to stop money laundering in their respective financial systems.
Nearly all the precursor chemicals needed to make the deadly substance fentanyl are coming from China into the US.
The US says exchanging information on money laundering related to fentanyl trafficking may help disrupt the flow of the precursor chemicals into Mexico and the US.
“Treasury is committed to using all of our tools, including international cooperation, to counter this threat,” Yellen said in a speech announcing the formation of the group.
The new cooperative between the US and China will be part of the two nations’ economic working groups, which were launched last September, and the first exchange will be held in the coming weeks.
TikTok
Efforts in the US to ban the social media app TikTok, owned by the Chinese parent company ByteDance, were raised initially by the Chinese during US-China talks, a senior Treasury official told the Associated Press news agency. The firm has in the past promoted a data security restructuring plan called “Project Texas”, which it says sufficiently guards against national security concerns.
However, US lawmakers have moved forward with efforts to either ban the app or force the Chinese firm to divest its interest in the company, which the White House has supported. In China this week, it was evident there was little movement on the issue.
Yellen said at a news conference Monday that she supported the administration’s efforts to address national security issues that relate to sensitive personal data.
“This is a legitimate concern,” she said.
“Many US social apps are not allowed to operate in China,” Yellen said. “We would like to find a way forward.”
Financial stability
On the second day of Yellen’s trip to China, the US and China announced an agreement to work closely on issues related to financial stability, in that US and Chinese financial regulators agreed to hold a series of exercises simulating a failure of a large bank in either of the two countries.
The aim is to determine how to coordinate if a bank failure occurs, with the intent of preventing catastrophic stress on the global financial system.
Yellen said several exercises have already happened.
“I’m pleased that we will hold upcoming exchanges on operational resilience in the financial sector and on financial stability implications from the insurance sector’s exposure to climate risks.
“Just like military leaders need a hotline in a crisis,” Yellen said.
“American and Chinese financial regulators must be able to communicate to prevent financial stresses from turning into crises with tremendous ramifications for our citizens and the international community.”
What she ate
Yellen is something of a foodie celebrity in China ever since she ate mushrooms that can have psychedelic effects in Beijing last July.
This trip was no different.
High-ranking Chinese officials brought up her celebrity ahead of important meetings – Premier Li Qiang noted in his opening remarks that Yellen’s visit has “indeed drawn a lot of attention in society”, with media covering her trip and her dining habits.
And social media was abuzz, following her latest movements around Guangzhou and Beijing.
This time in Beijing, Yellen ate at Lao Chuan Ban, a popular Sichuan restaurant. She also had lunch with Beijing Mayor Yin Yong at the Beijing International Hotel.
On Monday evening, her last night in China, Yellen visited Jing-A Brewing Co in Beijing – co-founded by an American – where she ordered a Flying Fist IPA, a beer made with US hops.
The collapse of a major bridge in Baltimore earlier this week has led to the suspension of vessel traffic at the Port of Baltimore, one of the busiest harbours in the United States, until further notice.
On Wednesday, it was reported that Maryland would receive initial funding of $60m from the federal government as state authorities work to clear the debris from the disaster. This emergency relief funding is to cover “mobilisation, operations and debris recovery”, the state said.
Here’s what we know so far about how this suspension might affect trade, insurers and the supply chain.
What happened to the Baltimore bridge?
The Francis Scott Key Bridge in Baltimore, Maryland, a steel bridge opened in 1977 which spanned the lower Patapsco River and the outer Baltimore harbour, collapsed when a container ship hit one of its support pillars at about 1:27am (05:27 GMT) on Tuesday.
Cars that were crossing the bridge fell into the river, and six workers went missing and are now presumed dead.
The Singapore-registered ship which hit the bridge was named the Dali and was heading to Sri Lanka. All 22 crew members as well as two pilots have been accounted for and there were no reports of injuries.
Since the incident, vessel traffic has been suspended in and out of the port. However, the port is not closed and trucks are still being processed within the maritime terminals.
A coastguard boat carries senior officers to assess the Francis Scott Key Bridge collapse, in Baltimore, Maryland, on March 29, 2024 [US Coast Guard/Petty Officer 1st Class Brandon Giles/Handout via Reuters]
How important is the Baltimore port for trade?
The Port of Baltimore is the ninth largest US port in terms of overall trade volume. It handles cargo including automobiles, machinery, agricultural equipment, liquefied natural gas and sugar.
In 2023, the port handled about 50 million tonnes and $80bn of cargo moving between the US and other countries.
The port processed 847,158 automobiles last year, according to figures from the state of Maryland. About 70 percent of these were imported.
Nearly 20 percent of US coal exports pass through Baltimore.
More than 50 ocean shipping and cruise ship companies carry out business with the port, according to the state. Their vessels visit the port about 1,800 times per year.
What is the economic cost of the bridge collapse?
During a briefing at the bridge collapse scene, the US Representative for Maryland, David Trone, said that state and federal officials estimated the port’s closure would cost the economy as much as $15m per day.
Additionally, the port directly supports more than 15,000 jobs, with an additional 140,000 jobs dependent on port activity overall, according to Maryland Governor Wes Moore’s office.
This does not mean that these individuals will be laid off, but less traffic will mean they have less work to do. Being day labourers, they may lose wages.
Delays can also be expected by companies and customers as packages bound for processing at the port will have to be diverted elsewhere.
Losses stemming from the bridge collapse are likely to hit the insurance sector hard. Last week, Bloomberg reported that insurers could face claims amounting to as much as $3bn – including claims for damage to the bridge itself, liabilities for wrongful deaths and disruption to businesses caused by the closure of the port as ships bound for Baltimore will have to go elsewhere.
Bruce Carnegie-Brown, chairman of Lloyd’s insurance market in London, where many of the insurers facing claims for this incident are based, told Reuters that the collapse is likely to lead to a “multibillion-dollar insurance loss” and could become the “largest single marine insurance loss”.
The estimated time of arrival for Baltimore-bound vessels doubled between Monday and Tuesday, according to Windward, a maritime risk management company. Windward additionally predicted that ships scheduled to go to Baltimore would be delayed by at least 24 days.
However, experts say that the knock-on effects of the suspension should be manageable in the short term. After all, Baltimore’s port holds just 4 percent of all East Coast trade volume, according to S&P Global.
How will businesses using the port be affected?
Several companies which use the port have said the suspension will not negatively affect short-term operations. The US’s largest sugar company, ASR group, reported that it has six to eight weeks of raw sugar stocks at its Baltimore refinery, which is supplied by vessels coming to the port.
Berkshire Hathaway Energy, the operator of the Cove Point liquefied natural gas terminal, also said operations were not immediately affected. German car manufacturer BMW said that, besides short-term traffic delays, it does not expect other short-term impacts. Volkswagen, Mercedes and General Motors also expect little to no effect besides delays.
However, Ford Motor Company chief financial officer John Lawler told Reuters on Tuesday: “We’ll have to divert parts to other ports … It will probably lengthen the supply chain a bit.”
Where will Baltimore-bound ships and containers be diverted to?
Baltimore-bound ships are currently anchored beyond the port and waiting to be rerouted to other ports up and down the East Coast in the US.
Ports in Philadelphia, Wilmington, Delaware; Newark, New Jersey; Norfolk; Charleston, South Carolina; Jacksonville, Florida; and Georgia also could see additional cargo.
While the Georgia Ports Authority, which owns ports in Savannah and Brunswick, said it has the capacity to take on more cargo, it can not make up for Baltimore by itself.
Part of Baltimore’s operations are still operational, east of where the bridge collapsed, the port said. Hence, it can still handle automobiles from companies including BMW and Volkswagen.
How will consumers be affected?
Supply chain experts say US port infrastructure is stronger than it was in 2021 and 2022 when businesses were understaffed and struggling with backlogs of ships and containers as a result of the COVID-19 pandemic. This caused consumer prices to spike. Experts do not expect this to happen on a wide scale now.
“The collapse of the Francis Scott Key Bridge in Maryland is another reminder of the US vulnerability to supply-chain shocks, but this event will have greater economic implications for the Baltimore economy than nationally,” Ryan Sweet, chief US economist at Oxford Economics, wrote in a note.
“We don’t anticipate that the disruptions to trade or transportation will be visible in US GDP, and the implications for inflation are minimal,” he added.
Where else in the world has shipping been disrupted?
Attacks on the Red Sea by Yemen’s Houthi group have reduced traffic travelling through the Suez Canal, through which some 15 percent of the world’s shipping traffic passes. Diverted cargo shipments between Asia and Europe are causing price rises for manufacturers.
Additionally, the Panama Canal, which handles 6 percent of the world’s maritime commerce, is experiencing decreasing water levels, reducing the canal’s capacity and hence the number of ships able to pass through it. In late August 2023, drought conditions caused the Panama Canal to announce prolonged transit restrictions.
Compared with lingering supply-chain effects caused by the Red Sea attacks and COVID-19, experts say the fallout from the bridge collapse will be temporary.
Dakar, Senegal – For the traditional, small-scale fishermen of Ouakam Beach in Senegal’s capital Dakar, inequality is just a glance away.
Adama Gueye, a 58-year-old canoe captain, points towards the coast, where imposing villas of the upper-class, including politicians, sit tall and mighty a stone’s throw away from where he fishes.
“We can see the inequalities with our own eyes,” the fisherman told Al Jazeera.
For him, the injustice is compounded by decreasing fish stocks in the West African nation, where the centuries-old tradition of artisanal fishing is menaced by foreign industrial boats that export the fish away from Senegal.
But hope is on the horizon and it lies in his country’s new president: Bassirou Diomaye Faye.
Newly elected this week after years of tribulations and political crises – including a recent failed attempt by outgoing leader Macky Sall to delay the vote – Faye is Africa’s youngest leader at 44.
For many disenfranchised Senegalese fishermen who feel they have been wronged by their former leaders, he is also a symbol of change.
“[Faye] knows how much a kilogram of rice costs,” said Gueye, “he’s young, he was born in poverty, he didn’t go to private schools abroad – he’s one of us.”
Traditional fishing canoes, called pirogues, are parked at the Ouakam beach [Andrei Popoviciu/Al Jazeera]
For the past years under President Sall, legal fishing by industrial foreign trawlers from China and Europe who had signed contracts with the government, decimated Senegal’s fish stocks, leaving artisanal fishers with empty nets.
This scarcity also led local fish prices to soar, according to fishermen – something that could significantly affect people’s nutritional intake, as Senegalese get about 40 percent of their animal protein from seafood, according to 2017 figures.
In 2018, the value of Senegal’s legal fish exports reached more than $490m, according to the United Nations Food and Agriculture Organization, accounting for 10 percent of the country’s exports, behind only phosphates, oil and gold.
Senegal also loses $272m per year because of unauthorised and illegal industrial fishing by foreign boats, according to the Institute for Security Studies.
Foreign boats are restricted from fishing in certain areas and have strict indicators as to what type of catch they are allowed to fish. But often, they turn off their satellite transponders to avoid being tracked and use illegal nets.
The fishing industry contributes nearly 1.8 percent to Senegal’s GDP, providing more than 600,000 jobs, according to the Environmental Justice Foundation – a number that could be higher due to lack of registration.
Without fish, many livelihoods that depend directly and indirectly on fishing are lost, and a sizeable number of fishermen choose to immigrate to other countries or use their sailing skills and take dangerous boat journeys to Spain’s Canary Islands. In 2023, the UN refugee agency had registered more than 15,000 arrivals to Spain.
But now, the president-elect wants to change the fate of fishermen.
‘An agreement to steal our resources’
When Faye announced his electoral programme at the start of the month, he mentioned shifting the fishing zone exclusive for artisanal fishermen by 20km (12.4 miles) to protect it from foreign boats.
He also announced his intent to develop and implement a National Plan for the Immersion and Management of Artificial Reefs, an attempt to reconstruct marine habitats and ecosystems degraded by years of damaging industrial and artisanal fishing practices.
“We will apply without concession and in all its rigour the regulations on sea fishing to put an end to the political and complacent management of the sector,” local media quoted him as saying.
In advance of the vote, Faye also signed a charter for sustainable fishing, alongside other candidates. Proposed by Senegal’s National Coalition for Sustainable Fishing and supported by Greenpeace during this month’s election campaign, the charter included a commitment to oversee stock management at the sub-regional level, conduct audits on a fishing agreement with the European Union, and allocate a portion of revenue generated from oil and gas exploitation to the fishing sector.
Fishing is a central part of the Senegalese economy, providing more than half a million jobs, much more according to some [Andrei Popoviciu/Al Jazeera]
Under Sall’s government, Senegal renewed a fishing agreement with the EU that had been present in one form or another since 1979 and has been renewed every five years. The deal gives European vessels access to fish in Senegalese waters and exports that catch back home in exchange for 800,000 euros ($863,104). The EU also provides Senegal with an additional 900,000 euros ($970,992) in investments in artisanal fishing and to improve stocktaking capabilities, enhancing research and data gathering in the fisheries sector and issuing health certifications for seafood products.
But the deal has been controversial. While most fishing agreements have a transparency clause regarding how much fish is exported by European vessels, the EU-Senegal deal does not. While the EU invests in the artisanal fishing industry and fishing governance, fishermen like Gueye have argued that if there are no fish to catch, there is no point to these investments.
Chinese and Turkish industrial boats have also been heavily criticised for their practices. For instance, it has not been uncommon for the government to give licences to boats with a history of illegal activities. Chinese and Spanish fishmeal companies based in Senegal, which turn the catch into fish feed to then be used to raise farm fish in China, have garnered criticism in recent years. In 2022, fishermen sued a Spanish fishmeal factory, accusing it of polluting drinking water.
As president, Sall focused on developing the country through investments and deals with foreign countries. He was harshly criticised by the opposition – led by Faye and his ally Ousmane Sonko – for deals that were not in the interest of the Senegalese but of companies and politicians who extract resources for exports with little trickling down to other citizens.
Faye believed it was one of the biggest grievances Senegalese had with the former government, so he ran on a campaign to revamp Senegal’s natural resource export deals with foreign countries and lend an ear to artisanal fishermen, who felt they had not been consulted before these contracts were signed by the previous government.
“The EU signed an agreement with Senegal to steal our resources, that’s why people are going to Europe,” said Gueye, referring to the thousands of local fishermen migrating to Europe on small boats.
“I hope Diomaye will put them in their place,” he said, adding that the new president also needs to crack down on illegal fishing, illegal nets and regulate how both industrial and artisanal fishermen operate.
“We have hope he will work for us.”
Helping Senegalese fishermen
Fishermen could see the impact themselves. Moussa Gueye (not related to Adama), a 30-year-old fisherman at Ouakam Beach born in a family with a tradition for fishing, told Al Jazeera that during the COVID-19 pandemic, when restrictions limited the presence of industrial boats, fish were plentiful.
Moustapha Senghor, coordinator of the local artisanal fisheries council of Mbour, a city on the southern coast of Senegal, told Al Jazeera that Sall had made efforts to address issues with fishing but they were “insufficient”.
“There is a lack of transparency in fisheries governance in Senegal,” said Senghor, who stressed the need for open data resources that show the vessels operating in Senegalese waters, where they can fish and where they can not, and how much fish is there.
He concurs with the other fishermen’s call for a revision of fishing agreements.
Fishing also converges with migration in Senegal. “Most of the fishermen are looking to the Canary Islands to reach Europe because they’re worried about the continuation of their fishing activities, especially in view of the cohabitation with oil exploitation,” Senghor said.
Many fishermen have lost their livelihoods because of depleted fish stocks [Andrei Popoviciu/Al Jazeera]
In 2014, significant natural gas reserves were discovered offshore near the Senegalese city of St Louis. International players like British Petroleum (BP), which has the highest stake in the project, and US-based Kosmos Energy have invested in the project together with the Senegalese government. After the project was announced, European statesmen made official visits to court former President Sall for potential export deals.
The extraction of gas was expected to bring $1.5bn in exports by 2025 if it were to start when it was scheduled at the beginning of the year, but there have been several production delays. Offshore oil exploitation for exports is also expected to start production in the following years.
Meanwhile, fishermen in St Louis have complained of the effect the oil and gas rig has on their activities, including the cut off of fishing near the rig and the impact on what is one of the world’s biggest cold water reefs.
Bassirou Diarra, a fisheries and aquaculture engineer and researcher at the Cheikh Anta Diop University in Dakar and campaigner at the Environmental Justice Foundation, told Al Jazeera there is a need to invest in scientific research as well.
A centre for oceanographic research would be able to monitor the stock of fish and report on how much can be fished sustainably, while also monitoring the pollution and impact of the rig on the biodiversity in the region. Diarra said Senegal’s current fishing agreements are remnants of his country’s colonial past.
“Macky Sall has implemented [fishing] policies that continued the system of exportation,” added Senghor. “[Faye] needs to help the Senegalese eat and produce their own fish and not export all of it abroad.”
Not just economic interests threaten the fishermen.
Back at Ouakam Beach, Gueye, the canoe captain, pointed out how the shore has been swallowed by the sea for the past 30 years, due to rising sea levels. He is hopeful Faye will also address this key issue and protect the fishermen from the effects of climate change.
As the beach is flooded by a bright sunset, Gueye makes his last caveat clear. Despite the faith he puts in the new president, recent political upheavals in the last years of Sall’s rule have made him more cynical.
“We’ve woken up as a society,” he said. “If [Faye] doesn’t do the job well, he won’t last more than one term.”
According to the survey by the British Chambers of Commerce (BCC), 55 percent of exporters reported higher shipping costs and delays, as did 53 percent of manufacturers and business-to-consumer services firms.
Among all types of businesses, 37 percent of companies were affected by the attacks, according to a survey of 1,000 firms between January 15 and February 9.
Some businesses surveyed said container hire costs had jumped as much as fourfold, while delivery times had blown out by up to four weeks.
“There has been spare capacity in the shipping-freight industry to respond to the difficulties, which has bought us some time,” William Bain, BCC head of trade policy, said on Sunday.
“But our research suggests that the longer the current situation persists, the more likely it is that the cost pressures will start to build.”
The Iran-backed Houthis have carried out dozens of missile and drone attacks on commercial ships in the Red Sea, one of the world’s busiest shipping routes, since the start of the war in Gaza.
The rebel group claims to be targeting vessels with links to Israel in an effort to show solidarity with Palestinians under Israeli bombardment in Gaza.
The Houthi attacks have caused major disruption to global trade, with trade volume going through the Suez Canal, which connects the Red Sea to the Mediterranean Sea, falling an estimated 42 percent, according to the United Nations Conference on Trade and Development.
Earlier this month, Tetley Tea, the UK’s second-most popular tea brand, said it was facing “much tighter” supplies due to disruptions in the Red Sea.
The United States and the UK have launched dozens of strikes against targets linked to the Houthis in response to the attacks.
On Saturday, the US and UK militaries said they had bombed 18 Houthi sites in Yemen, including underground weapons and missile storage facilities, air defence systems, radars and a helicopter.
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