The price of steel in Bangladesh is soaring, and the cause is undoubtedly the trade war.
The trade war between the world’s two largest economies has set a global chain of events in motion. Some countries, such as China’s Southeast Asian neighbors, seem to be benefiting from the fallout, while other countries, particularly in South America, seem to be getting the short end of the stick.
Steel is an essential ingredient to construction projects, among many other endeavors. The price of steel is now soaring in Bangladesh, slowing down both businesses and homeowners who are waiting for prices to drop again. Bangladesh relies on scrap metal imports from the US, which are used to make steel rods which form the backbone of newly constructed buildings. Unfortunately, these steel rods have become far more expensive to build as the cost of importing steel has risen. As a result, Bangladesh’s imported steel hub, the capital city of Dhaka, has seen a slowdown. Business people can only describe the current situation as “bad.” Some traders in the Bangladeshi steel industry are currently stockpiling steel in the hopes that the price of steel will rise when the trade war ends, according to Al Jazeera. For the time being, the two-decades long boom in the Bangladeshi construction industry appears to be slowing down as a direct consequence of the trade war.
US President Donald Trump’s protectionist trade policies are affecting the Bangladeshi construction industry, even though Bangladesh is of course not the target of Trump’s policies. The World Trade Organization recently released a warning of a global economic slowdown due to several factors, with “trade tensions” playing a significant role.