SINGAPORE (Apr 2): Financial markets were rattled by fears that a trade war might break out between the US and China. A trade war may or may not happen, but it is probably not the biggest risk we face. No, the real concern is that when we peer under the surface of global politics, it looks likely that recent developments in the US, China and the Middle East could create lots of turbulence in the coming months. Trade tensions will probably be just one of many potential flash points.

The US: A harder edge to its foreign and trade policy

President Donald Trump has recently replaced several senior members of his administration with people known for their more combative approach to foreign and trade policy. Secretary of State Rex Tillerson has left, replaced by Mike Pompeo, while National Security Advisor Lieutenant General H R McMaster gave way to John Bolton. Both Pompeo and Bolton are known for their hawkish views on important foreign policy issues such as North Korea and Iran. Both have advocated the use of force, with Bolton best known as the blunt-speaking and controversial US representative to the United Nations during President George W Bush’s time. It is rumoured that White House Chief of Staff John Kelly, who has tried to bring order and structure to Trump’s presidency, might also be forced out soon.

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