Biz leaders sound alarm as Trump tariffs prompt global markets bloodbath

The Management Association of the Philippines (MAP) called for the creation of an economic security council as the business sector continues to grapple over the global trade implications of the 17 percent tariff imposed by the United States on Philippine exports.

Wall Street led a global markets bloodbath yesterday as countries around the world reeled from President Donald Trump’s trade war, including the local benchmark Philippine Stock Exchange index (PSEi) which lost 61.54 points or 1 percent to close at 6,084.19.

China on Friday also immediately retaliated, saying it would slap 34 percent tariffs on all imports of US goods from April 10 after Washington imposed steep new levies on Chinese products.

China will also file a lawsuit with the World Trade Organization (WTO) over tariffs, Beijing’s Commerce Ministry said.

MAP president Alfredo Panlilio said while the Philippines at this time is seen as not as negatively affected as others, “we cannot discount the possibility that as other countries are affected, it may prosper into a contagion that will eventually affect us” with the global economy being an integrated ecosystem.

“As what many countries have already done in anticipation of these developments, we recommend the formation of an economic security council under the Office of the President…The council should be headed by and composed of individuals with extensive diplomatic, economic and industry expertise.”

“The council’s main tasks would be to compile data and information, analyze their correlation and impact on our economy, and recommend risk-mitigating measures for the affected industries. It can also identify opportunities and alternative markets that these developments will provide for our own economy and businesses,” Panlilio added.

The Philippine Economic Zone Authority has acknowledged the recent imposition of a 17 percent tariff by the US on Philippine-made goods could be an opportunity to broaden the country’s trade and investment relationships with the US while pushing for diversified relations.

The comparatively lower rate – second lowest in Southeast Asia next only to Singapore’s 10 percent – strengthens the economic ties between the Philippines and the US and positions the country more favorably than its regional counterparts, said PEZA director general Tereso Panga.

By relocating operations to the Philippines, companies in countries slapped with higher tariffs could reduce their export costs, Panga said.

This, coupled with other positive developments like the Philippines’ participation in the Regional Comprehensive Economic Partnership (RCEP), the impending renewal of the European Union Generalized Scheme of Preferences (EU GSP), and the enactment of the CREATE MORE Act, positions the Philippines as an attractive investment destination, he added.

Shock waves tore through markets in the United States, Europe and Asia after Trump’s tariff bombshell, as foreign leaders signaled readiness to negotiate but also threatened counter-tariffs.

The S&P 500 dropped 4.8 percent in its biggest loss since 2020. The tech-rich Nasdaq plummeted 6.0 percent and the Dow Jones 4.0 percent.

Tokyo’s key Nikkei 225 index was down 1.8 percent in early trade Friday.

Trump slapped 10 percent import duties on all nations and far higher levies on imports from dozens of specific countries—including top trade partners China and the European Union.

Separate tariffs of 25 percent on all foreign-made cars also went into effect, and Canada swiftly responded with a similar levy on US imports.

Stellantis—the owner of Jeep, Chrysler and Fiat—paused production at some Canadian and Mexican assembly plants.

Trump dismissed the turmoil, insisting to reporters as he left for a weekend at his Florida golf resort that stocks will “boom.”

Vice President JD Vance, in an interview with Newsmax, also played down the market turbulence.

“I frankly thought in some ways it could be worse in the markets, because this is a big transition,” Vance said.

Trump says he wants to make the United States free from reliance on foreign manufacturers, in a massive economic reshaping that he likened to a medical procedure.

“It’s what is expected,” the 78-year-old president said of the market reaction. “The patient was very sick. The economy had a lot of problems.”

“It went through an operation. It’s going to be a booming economy. It’s going to be amazing.”

Amid howls of protest abroad and from even some of Trump’s Republicans, who fear price rises at home, Commerce Secretary Howard Lutnick urged patience.

“Let Donald Trump run the global economy. He knows what he’s doing,” Lutnick said on CNN.

Trump reserved some of the heaviest blows for what he called “nations that treat us badly.”

That included an additional 34 percent on goods from China—bringing the new added tariff rate there to 54 percent. The figure for the European Union was 20 percent, and 24 percent on Japan.

IMF chief Kristalina Georgieva said the tariffs “clearly represent a significant risk to the global outlook.”

She appealed to Washington and its trade partners to work “constructively” to resolve tensions and reduce uncertainty.

Gold—a safe-haven investment—hit a new record price, oil fell and the dollar slumped against other major currencies.

Ngozi Okonjo-Iweala, head of the World Trade Organization, which helps manage global trading, warned the upheaval may lead to contraction of “one percent in global merchandise trade volumes this year.”

White House spokeswoman Karoline Leavitt told CNN earlier that Trump made it clear “this is not a negotiation.”

And Lutnick also struck a hard line, saying, “You can’t really fight with the United States.”

“You’re going to lose. We are the sumo wrestler of this world.” With AFP