Trump given a basic trade lesson by IMF, World Bank

A potential trade war between China and the United States was the focus of attention as the world's central bank governors and finance ministers assembled in Washington this week for the International Monetary Fund/World Bank annual spring meeting.

At the Tuesday morning news conference on the IMF's World Economic Outlook report, I asked about the possible impact of US President Donald Trump's announcement and imposition of tariffs and the threat to cancel trade deals. I was surprised, however, that journalists from Europe, Africa and Latin America all posed questions on how their regions and countries would be impacted by a trade war between the world's two largest economies.

Such deep concern around the world was a key takeaway at the annual meeting. Indeed, the IMF's report warns a trade war would have a devastating effect on the global economy, which would be the true loser of a trade war. The first shots were fired when, inconsistent with the World Trade Organization principles, the US announced in March its intent to slap tariffs on steel and aluminum imports for national security reasons.