HKUST Business Review

In a time of unprecedented economic upheaval, the HKUST Li & Fung Supply Chain Institute hosted a seminar on “Trump’s Tariffs and their Impact on Global Business” bringing together leading voices in global trade, economics, and logistics to address the seismic shifts reshaping globalization and international commerce. Moderated by Professor HUI Kai-Lung, Acting Dean of the HKUST Business School, the seminar featured heavyweights from the industry and academia including Andy TUNG, Managing Partner of QBN Capital and Non-Executive Director of Orient Overseas (International), Dr James THOMPSON, Chairman of Crown Worldwide, and Professor Edwin LAI, Professor Emeritus, from the HKUST Business School Department of Economics. Together, the speakers offered a riveting exploration of the implications of the US’s new tariffs, the opportunities and challenges for China and Hong Kong, and the future of global trade. The event examined various perspectives on US trade policies and China’s evolving economic role, offering a comprehensive roadmap for navigating the new economic landscape. The End of Globalization Tung opened the seminar with a bold and thought- provoking statement: “Globalization as we knew it is probably over.” With the multilateral trading system meticulously constructed by the US after World War II now being dismantled by its own architect, Tung argued that the world is witnessing the end of an era. “This doesn’t mean we’re going to rapidly de- globalize,” he explained. “It is difficult to do that. But the growth rate of globalization will certainly not be what it was before.” He illustrated his point with stark statistics: where container volume once grew three times faster than GDP, it now grows at nearly the same rate. “Every hour, there’s something new happening,” Tung said, capturing the dizzying unpredictability of current trade dynamics. Ominously, Tung also warned of a fractured future for global trade, where political considerations increasingly overshadow economic efficiency. “Business decisions will no longer be made solely based on economic factors,” he said. “Every cross-border issue will now require navigating complicated political angles.” Investors are already responding to these shifts, with some becoming hesitant to engage with funds from Hong Kong or Mainland China. “It’s becoming an odd place to be,” Tung said. As for bringing manufacturing back to the US, I very much doubt it. Reducing the current account deficit? Maybe, but at the cost of inflation and increased costs to American manufacturing. Professor Emeritus Edwin Lai HKUST Business School Department of Economics HKUST Business Review 35 Cover