Capitol Report: Trump Policies Are Causing World To Look To Get Around U.S. Sanctions, Ex-Treasury Secretary Lew Says

By

Senior economics reporter

Jack Lew, former U.S. Treasury secretary

The world is increasingly looking for ways to circumvent U.S. economic sanctions and the Trump White House’s “go-it-alone” foreign policy is spurring this process, said former Treasury Secretary Jacob Lew on Tuesday.

The lack of support among U.S. allies for the U.S. decision to reintroduce sanctions on Iran has launched “a process to look for ways around U.S. sanctions with more creativity and more energy than we’ve seen before,” Lew said during a conversation at the Atlantic Council.

“The plumbing is being built and tested to work around the United States,” he said.

While not an immediate issue, over time there will be alternatives developed that will chip away at the “centrality” of the U.S., Lew said.

“I think the way the U.S. is approaching the use of its unilateral authorities now is causing that process to hasten,” he said.

He said he hoped the Trump White House would reverse course before the alternatives become a reality.

“There is some period of time that the world will wait before it says ‘we’re going to start to develop these things in the most aggressive way,’” he said.

Lew also said he didn’t think President Donald Trump’s approach on North Korea would succeed.

“The odds of North Korea actually putting its nuclear program on hold is a long shot,” Lew said.

Economic sanctions in place have been undermined by the president’s “grandiose embrace” of North Korean leader Kim Jong-un, he said.

Trump said he will hold a two-day summit with the North Korean leader on Feb. 27-28 in Vietnam.

Read: Trump, Kim to hold second summit

Want news about Europe delivered to your inbox? Subscribe to MarketWatch's free Europe Daily newsletter. Sign up here.

RECENT NEWS

What A Rising VIX Means For Pension Funds

Wall Street’s latest selloff has moved beyond a technology-sector wobble and become a broad market event. The Nasdaq C... Read more

Behaviour Cannot Fix A Portfolio Construction Flaw

A Retiree Shouldn't Be Asked to Behave Their Way Out of a Portfolio Construction Problem Why behavioural coaching shoul... Read more

Behavioural & Retirement Portfolio Resilience

Behavioural Survivability and Retirement Portfolio Resilience Why the lived experience of market recovery matters as mu... Read more

Australia's Rate Rise Bites: Highest In 15 Years

The Reserve Bank of Australia has lifted interest rates to their highest level since 2011, and its governor admits the w... Read more

October Retirement Portfolio Resilience Assessment

Markets stabl Read more

Gyrostat September Retirement Portfolio Resilience Assessment

September Retirement Portfolio Resilience Assessment Markets have fallen. The price of risk has risen. ... Read more