Trump’s big, costly, coercive trade deals falling apart in Asia

American economist Anne Krueger, 91, has witnessed a great deal of public policy chicanery during her stints as a top executive at the International Monetary Fund and World Bank. Yet Donald Trump’s tariff gamble on South Korea — including a US$350 billion “signing bonus” — has the battle-tested Krueger, who has also seen her share of financial crises, literally shaking her head with a mix of confusion and disgust.

“Korea is going to be hurt if all of this happens,” she said in an interview in Seoul. “Other countries will be harmed, but not as much as the US will harm itself.”

Korean President Lee Jae-myung’s thoughts have arrived at a similar place. As he told Reuters, Trump’s ask — equivalent to more than 18% of Korea’s gross domestic product — will push the economy to the brink of near collapse if fulfilled.

“Without a currency swap, if we were to withdraw $350 billion in the manner that the US is demanding and to invest this all in cash in the US, South Korea would face a situation as it had in the 1997 financial crisis,” Lee said.

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