Summary of a television interview · Based on the recording of the conversation
In brief
In an interview with Bulgaria ON AIR, Kliment Robev discusses the risk of recession in the US and the global economy against the background of Donald Trump’s tariffs. He argues that Trump is seeking a so-called technical recession to step up pressure on the Federal Reserve to cut rates faster, which would weaken the dollar, make US goods more competitive and support reindustrialisation. In his view, only China has seriously stood up to the US.
Key points
- He believes the worst of the tariffs came on 2 April, when, in his reading, Trump laid out the most negative scenario and invited other countries to negotiate within a 90-day period.
- In his view, the impact of tariffs depends not on the size of a country’s exports to the US but on their weight in its GDP, which is why Mexico, Canada and Vietnam rushed to negotiate, the European Union and Japan are waiting, and China responded immediately with counter-tariffs because it can afford to.
- He thinks there will be no winners in the short term, only a redistribution of capital and market share towards more agile companies and countries; the US will be hit too, but a weaker dollar would soften the effect, which is why Trump keeps pressing Fed Chair Jerome Powell for lower rates.
- As the clearest result of the first 100 days he points to Trump’s falling approval rating, arguing that he is running the US like an indebted corporation focused on cutting costs, including more than 200,000 federal job cuts; he is more sceptical about reindustrialisation, as office workers are unlikely to move to assembly lines.
- He sees the US as the winner from the rare earths agreement with Ukraine, since lithium and graphite matter for electric vehicles and technology, while China’s export restrictions on such metals hit mainly the US technology sector.
- He considers it highly likely that the US will be in a technical recession as early as July, as he expects the second quarter to show falling GDP as well; for Bulgaria he sees no direct hit from the tariffs but a possible opportunity, as a deeper US–EU trade war could push European companies to move production to lower-cost economies such as Bulgaria.
Context
The conversation was prompted by a Reuters poll in which most economists saw a high risk of the global economy falling into recession this year because of Trump’s tariffs, which have unsettled financial markets. It takes place around the 100-day mark of Trump’s presidency and also touches on the US–Ukraine agreement on rare earth metals.
Views reflect his position at the date of publication and are not investment advice. Regulatory information
