Trump's law of the jungle means U.S. trade deals aren't worth the paper they're printed on, trade expert warns

Yahoo

12-07-2025

By dismantling the mechanism that settles international trade disputes, there is no way for countries negotiating with the Trump administration to enforce any bilateral trade agreements. With little incentive to play by the rules, he could simply change the terms of any deal down the road. The best solution would be kicking the U.S. out of the World Trade Organization, argues trade expert Kristen Hopewell from the University of British Columbia, and re-establish the WTO's Appellate Body, the supreme court for global trade.
When President Trump threatened Brazil with punishing tariffs on Wednesday, there was no fancy mathematical equation trotted out this time as justification.
The 50% levy on goods was retribution for a perceived 'witch hunt' against his political ally, Jair Bolsanaro, whose supporters attempted a coup two years ago.
This administration is bringing back the law of the jungle to international trade, according to trade expert Kristen Hopewell, and time is running out to salvage the remains of a post-war system of commerce that promoted stability and prosperity across the world.
'Trump is a totally unreliable negotiating partner,' she tells Fortune. 'Any deal you strike with the administration is not worth the paper it's written on.'
As if to hammer home that point, news began to emerge on Thursday that Vietnam had been caught off guard when Trump prematurely announced a 20% duty on all goods entering the U.S. from the southeast Asian country. Vietnamese officials were reportedly still hoping for a number closer to half that.
Nor is there any apparent rhyme or reason to his tariffs. Brazil, for example, doesn't even run a trade surplus with the United States—it imported $28.6 billion more goods and services from the U.S. last year than it exported. On Wednesday, when asked how he calculated his various import duties, the president answered that he uses 'a formula based on common sense,' one that reflects 'how we've been treated.'
Hopewell, a professor at the University of British Columbia, argues this erratic and fickle approach to international negotiations is symptomatic of a Trump deal: 'He can simply come back later demanding more. There's no guarantee it will actually be upheld.'
That's because the president already removed a cornerstone underpinning global commerce during his first administration six years ago when he blocked all appointments to what is essentially the supreme court of the World Trade Organization (WTO) — its Appellate Body.
'The WTO is unique amongst international organizations in that its rules are actually legally binding on states. It has teeth,' Hopewell said. Or rather it had teeth.
Since the Biden administration continued its policy of blocking appointments to fill its vacancies, there is now no quorum to adjudicate trade disputes, leaving countries little incentive to abide by the rules anymore. Quite the contrary, they can break them with near impunity.
The United States didn't always favor dismantling these guardrails.
Over a decade ago, the country led a number of key partners, including Japan and the European Union, to press their rights against China when it attempted to restrict the export of critical minerals, including rare earths.
In 2015, they later won in front of the Appellate Body, forcing Beijing to relent.
Thanks to Trump, this enforcement mechanism no longer works.
In January 2020, just weeks after the WTO's Appellate Body was decommissioned, Indonesia moved to impose a ban on the export of raw nickel.
Since it has one of the largest remaining deposits of this element vital for electric vehicle batteries and stainless steel, it reckoned it could compel the creation of a domestic downstream industry for processing and refining the ore.
Other countries argued in front of the WTO that it violated the rules and won—or at least they thought they had.
Indonesia exercised its right to lodge a formal appeal to the Appellate Body, knowing full well that a ruling that settles the dispute was impossible.
'By appealing into the void, it could continue these WTO illegal export restrictions of nickel and is actually expanding them to other commodities,' Hopewell says. 'Other countries are now mimicking Indonesia and introducing similar bans on mineral exports.'
Hopewell believes the moment for bold action has arrived. In a column for Politico this week, she argued the international community should consider expelling the United States from the World Trade Organization in order to revive its paralyzed Appellate Body.
'The stakes are really high, so it's worth considering more radical solutions,' she told Fortune.
That attitude, Hopewell says, is no accident. Trump has long sought to undermine the WTO in favor of bilateral deals, where the U.S. holds more leverage.
'Trump is pursuing a divide-and-conquer strategy,' she said. 'He knows the U.S. is strongest when it negotiates one-on-one.'
By agreeing to bilateral talks, she argues, foreign governments hoping to protect domestic industries are undermining themselves. 'They're playing right into Trump's hands.'
Contacted by Fortune, the WTO Secretariat said it does not comment on the conduct of member states. The White House declined to respond.
To many Americans, Trump's aggressive trade stance may appear cost-free. But the fallout has yet to reach consumers, in part because industries like autos stockpiled inventory ahead of new duties.
'It will take some time before the effects of the tariffs are felt in higher prices,' Hopewell said. 'But when that hits, it's going to be a profound economic shock for the U.S.'
This story was originally featured on Fortune.com