Adam Posen on Trump’s China Trade War, Global South Risks & India’s Economic Opportunity | News18

Global economic stability faces significant challenges as trade becomes increasingly weaponized through national security exemptions and geopolitical tensions. Adam Posen, president of the Peterson Institute of International Economics, argues that the United States’ current "all or nothing" approach to China is ineffective, advocating instead for consistent negotiation and strengthened alliances. While trade weaponization is a legitimate concern, its impact is often overstated, with most global commerce continuing outside US-China friction. Regarding emerging risks, the AI sector shows signs of a bubble, yet its potential collapse poses less systemic threat than previous financial crises due to current credit market conditions. Furthermore, India’s economic potential remains high, though it requires structural reforms to effectively compete as a manufacturing alternative to China. Finally, the excessive use of US sanctions is slowly driving an organic, albeit limited, shift toward non-dollar currency usage in international trade.