Final Word from Monday, March 19, 2018

M.I.T. economist David Autor told the New York Times recently that China's entry into the World Trade Organization in 2001 led to the sudden loss of about 1m factory jobs in Ohio, Michigan, Wisconsin and Pennsylvania, which are all states that Donald Trump won. The Trump administration is now considering putting together a "trade coalition of the willing" to take on China's violations of global rules. Despite the CR's huge trade deficit with China (Kč 261bn last year), the China "shock" referred to by Prof. Autor failed to have any significant impact on the Czech presidential elections. Jiří Drahoš's team tried to make China an issue but didn't gain any traction. The situation has now changed. Miloš Zeman's adviser Ye Jianming has apparently been arrested in China on Xi's order, and Zeman is the one who introduced the two of them. Trump is offering Zeman a way out of this face-losing situation. "It's Xi who isn't playing fair," could be the message Zeman starts sending. [Czech Republic imports exports surplus bilateral]