Brave New World

One big happy family 18/09/2009

Germany’s decision to directly intervene in the sale of the European arm of General Motors to Magna by providing state aid has not gone down well in the UK, Spain or Belgium. The European Commission said it would investigate the deal to see if it contravenes EU law on national subsidies influencing company locations.

So long as the global economy continues to grow we may only see a few of these newsworthy protectionist measures every week. US-China relations are a tad frosty following President Obama’s decision to raise tariffs on Chinese tyres. The inaugural G20 meeting in Washington late last year led to an agreement by to avoid implementing any protectionist measures. Since then 17 of the member countries have enacted protectionist policies of some kind. If, in 2010, the global recovery proves to be more fragile than the consensus forecasts expect many more headlines of this nature both globally and at regional/ EU level