The president of the Spanish investment bank denies an imminent global recession due to Trump's tariffs and believes the race for artificial intelligence has a long way to go.
Donald Trump's surprise return to the White House has been fraught with contradictions. One of the most obvious is the US president's tendency to push for economic deregulation, while adopting protectionist rhetoric in favor of imposing tariffs on Washington's neighbors. For Juan Carlos Ureta, president of the Spanish investment bank Renta 4 , this policy is no coincidence.
"While the global economy has been performing well for the past 10 to 15 years, to the point of overcoming adverse situations like the pandemic, it has also incubated significant imbalances. One of them is the overweight of the public sector, which has also translated into excessive spending, and that is an idea that Trumpism proposes to combat through deregulation," Ureta told AméricaEconomía during his visit to Peru.
The United States was no exception to this practice: the administration of Democrat Joe Biden (2021-2025) spent a total of US$25.98 trillion, representing a 36.11% increase over the previous period and becoming the highest figure for any presidential term, according to a study by Banco Base. These cash disbursements were financed through public debt, which boosted interest expenses.
Trump's policy of cuts has been reflected in actions such as the creation of the Department of Government Efficiency (DOGE), as well as the elimination of 83% of USAID's international programs, a measure criticized for its negative impact on vulnerable populations around the world.
However, at other times, Trump hides the liberal banner and raises the flag of protectionism. This is reflected in decisions such as the imposition of 25% tariffs on all steel and aluminum imports, as well as the tense negotiations with Mexico and Canada to agree on preferential terms.
Given this situation, Ureta believes there was an international trade model in which the US absorbed a large portion of global purchases, generating a very large trade deficit. This explains Trump's policy, but it does not necessarily justify it.
"While the United States cannot absorb the surpluses of other economies, the strategy of indiscriminately imposing tariffs on everyone doesn't seem likely to work, and in fact, that's what financial markets are currently discussing," he added.
Fears of a new recession in the world's largest economy have sparked panic on its main stock exchanges. This Tuesday, the 11th, the S&P 500 index, which includes the largest US companies, fell 2.69% at the close of trading. Meanwhile, the Dow Jones lost 2.08% and the Nasdaq sank 4.0%, marking the largest daily drop since 2022.
Even so, Ureta rules out the possibility that the world will suffer a financial crisis equivalent to that of 2008. The reason is simple: the fall of the US stock market will follow historic highs between 2023 and 2024. In fact, the S&P rose by more than 20% during this period.
"The US stock markets are correcting these extraordinary increases, whereas in 2008, American and global banks were left with very low levels of capital, in some cases zero. Currently, Trump's policies appear to be the only factor in their decline, but the reality is that the stock markets must correct their overvaluation at some point," Ureta explains.
On the other hand, a side effect of Trump's trade war would be that the new 20% tariffs on Chinese imports would generate higher inflation in the country. As a consequence, the Asian giant's ultra-expansionary policies and economic growth would be affected, harming demand for commodities exported by Latin American countries like Peru.
Ureta also criticized China's tendency to resort to dumping to promote the international distribution of its goods. In Peru and Chile, this phenomenon has manifested itself through the sale of steel and its derivatives at prices below market value. Elsewhere, China resorts to dumping manufactured goods.
“China subsidizes the electric cars its companies produce and then sells them in Europe, competing with non-subsidized vehicles. Because of practices like this, Trump's decision to impose tariffs on Beijing is also linked to the idea of forcing the country to comply with certain international trade standards. This differs from the cases in Mexico, Canada, or Europe,” Ureta adds.
According to the Spanish economist, trade disputes will bring competition for investments in various regions of the world. For example, a week ago, the American investment fund BlackRock bought two ports on the Panama Canal, amid Trump's accusations that it is in "Chinese hands."
Something similar could happen in the South Pacific: the United States, wary of growing Chinese influence through the Chancay Megaport in Peru, could invest in projects such as the remodeling of the Chilean port of San Antonio to counter the presence of the Asian dragon. "We're not just facing a trade war, but also an infrastructure war, such as large ports," Ureta analyzes.
Finally, the third axis of the "soft" war between the US and China is technology, with the development of generative artificial intelligence being a key point. In recent months, the launch of the Chinese language model DeepSeek has caused a stir for its accuracy in solving complex operations and reasoning. The fact that it is completely free differentiates it from American alternatives like OpenAI's ChatGPT and raises questions about its ability to dethrone the creation of Sam Altman's team.
Given this phenomenon, Ureta believes it is still premature to declare China the winner in the artificial intelligence race. “DeepSeek has demonstrated that a lower-cost AI model can be developed based on others developed by American companies. I think it's too unique a case to think it could undermine the enormous investment made by giants like OpenAI. Furthermore, DeepSeek still has many gaps and errors, although we cannot ignore its ingenuity.”
