The U.S. administration has begun negotiations with several major trading partners on the broader “tariff issue,” the initial results of which appear to be quite mixed.
A “Deal” with the United Kingdom
Still, if there’s a chance to gain “a bit more” from a junior (or senior — depending on perspective) “brother,” why not take it? While the details of the deal are still being finalized, it is already known that the original 10% “Trump tariff barrier” remains in place for the UK.
Washington seemed to assume from the start that London was more interested in reaching a deal — driven by foreign policy needs that outweighed certain economic costs. After Brexit, the UK’s struggling economy made the “tariff issue” just one more piece in a broader puzzle.
At the same time, the UK’s “shift toward Asia” and its attempt to revive an “East of Suez” strategy has recently met with a positive response. Notably, with Japan’s backing, the UK joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Similarly, discussions about candidates for top posts in British intelligence reflect this new orientation.
For London, the cost of failing in its “bid for Trump” lies not in economics, but in geopolitics. During both World Wars, the involvement of the U.S. was critical, despite the powerful isolationist movement in America. Today’s “Trumpism” in some ways echoes those same isolationist ideas.
Canada and Mexico
Against the backdrop of London’s tentative resolution of the suddenly arisen “tariff problem,” Canada also hoped for something similar. But so far, in vain. Although the direct meeting on May 6 between the new Canadian Prime Minister M. Carney and D. Trump was surprisingly peaceful. This, after weeks of mutual philippics, during which there were even remarks about “Canada being the 51st U.S. state,” where the Canadian prime minister would act as a governor. Welcoming his guest in the Oval Office, D. Trump created a rather positive atmosphere: “you can’t even make a joke anymore.” Though, as we know, every joke contains more than just a fraction of truth. Nevertheless, both sides stuck to their positions regarding the “crushing” tariffs they had imposed on each other.
It is worth noting that, unlike the UK, it is Canada — along with China and Mexico — that is among the key trading partners and main sources of U.S. trade losses. All three became top targets in D. Trump’s “tariff offensive.” They also drew particular attention for another, no less (and perhaps even more) important reason, summed up in one word: fentanyl. This word denotes what is arguably the most dangerous national tragedy in the U.S., and it undoubtedly complicates efforts to resolve the “purely economic” issues in Washington’s relations with both Canada and Mexico.
Specifically, the U.S. ambassador to Canada expressed doubt over the possibility of lifting the imposed tariff restrictions anytime soon.
U.S.-China Negotiations in Geneva
Trump called the May 10–11 negotiations in Geneva “a historic victory for the United States.” The talks focused on the broader “tariff problem” and were held between China’s First Vice Premier He Lifeng and U.S. Treasury Secretary Scott Bassent. It was especially noted that this “victory” came right after the resolution of the same issue with the UK.
The main results of the U.S.-China negotiations were laid out in a Joint Statement. We’ll leave aside the now-ongoing arguments about “who won and who lost.” What seems clear is this: the two leading global economies stepped back from the brink of a complete rupture in their trade and economic relations. Such a break would have severely impacted the political aspect of U.S.-China relations, which already appeared, to put it mildly, quite bleak.
It is also important to note that, according to a representative of China’s Ministry of Commerce, the Geneva outcomes are interim, and another round of negotiations is expected. The Joint Statement confirms this and adds that U.S. Trade Representative J. Greer will join the process.
In the positive coverage from the American press (as well as media in China and other countries), it is noted that the agenda will be expanded to include other equally important bilateral issues. For example, the fentanyl crisis, which remains a painful issue for the U.S., although China continues to rightly insist that it is a “domestic American” problem.
All global markets reacted immediately and positively to the published results of the Geneva talks. One could say that the global economic system finally “breathed a sigh of relief.”
On Negotiations with Japan
Let us recall that Japan was the first among the United States’ major trading partners to respond to D. Trump’s message in the spirit of: “Let’s make individual deals — or things will go very badly for you.” Japan was also among the first to feel that this was no empty threat. Its economy — heavily reliant on trade relations, with the U.S. as one of its core partners — is already beginning to experience serious consequences of the restrictions D. Trump imposed on access to the American market.
This primarily concerns the automotive industry, which is the backbone of Japanese exports to the U.S. Until now, bilateral trade had always ended annually with a surplus in Japan’s favor. A serious negative signal came in the form of an announcement from major Japanese automaker Nissan Motor Co. about its plan to lay off 20,000 employees — 15% of its total workforce. Another auto giant, Honda Motor Co., is expecting a 60% drop in operating profit this year.
Meanwhile, the first round of negotiations held in mid-April in Washington — with the direct involvement of the U.S. president — ended with no result. So far, there have been no signs of a shift in Washington’s position. At the same time, Tokyo reacted with jealousy and considerable indignation to the success of U.S. negotiations not with a key ally, but with its chief opponent. The situation is apparently being taken so seriously that Japan has decided to establish a special analytical center focused on economic security.
As for the United States, positive trends have been noted following the first quarter. So, despite President D. Trump’s outwardly flamboyant public behavior, his actual progress in the “tariff war” so far appears to be going fairly well.
At the same time, the political consequences of the U.S. negotiations with its main trading partners are currently almost impossible to predict.
Vladimir Terekhov, expert on the issues of the Asia-Pacific region
