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Business Times
2 days ago
- Business
- Business Times
Trump's China gambit belies rocky road ahead on tariff deals
[WASHINGTON] US President Donald Trump has come up short on striking trade deals with most nations with just one-month left before his self-imposed tariff deadline, even as he took his first steps in weeks towards engaging with China. Trump secured a much-desired call with Chinese President Xi Jinping, paving the way for a new round of talks on Monday (Jun 9) in London – yet the diplomacy was overshadowed by a blowout public fight between Trump and his billionaire onetime ally, Elon Musk. Trump's aides insisted on Friday that the president was moving on and focused on his economic agenda. Still, question marks remain over the US's most consequential trade relationships, with few tangible signs of progress towards interim agreements. India, which the Trump administration has cited as an early deal target, has taken a tougher line in negotiations and challenged Trump's auto tariffs at the World Trade Organization. Japan held another round of talks with the US, while also signalling it wants a reprieve from duties on cars and light trucks. The legal fight over Trump's tariffs hangs over everything. A court ruling striking down the country-by-country duties imposed using emergency authorities left partners with no certainty over what Trump's powers are. The next test could come as soon as next week, when a court could rule on the administration's appeal. Trump and his team were eager to draw attention to inroads with China as proof his ways are working. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Trump on Friday described talks with Beijing as 'very far advanced' and said Xi had agreed to speed shipments of critical rare-earth minerals that were at the centre of recent tension. Unlocking those supplies would spell relief for major American automakers. Chinese Vice-Premier He Lifeng will visit the UK next week, during which he will conduct trade negotiations with the US, the Chinese foreign ministry said in a statement late Saturday. The mixed results in the talks so far demonstrate the highs and lows of Trump's mercurial approach to trade, in which he and aides have cast him as the ultimate decision-maker on any deals. Rather than provide a clear-cut victory, Trump's dealings with Xi also show the difficult road ahead with China. The rare-earths dispute revealed how important those supplies, which Beijing dominates, are for the US economy. 'Xi is not letting go of the rare earths. He's got leverage, he's using it,' said Douglas Holtz-Eakin, president of the American Action Forum, a conservative think tank. 'They talked, that's the most important thing. I think they are really far apart.' The clock is ticking for Trump. His 90-day pause on higher tariffs for the European Union and nearly five dozen countries expires Jul 9 – barring an extension he could do with the flick of a pen – while China's reprieve extends until August. If deals are not reached, Trump plans to restore tariff rates to the levels he first announced in April, or lower numbers that exceed the current 10 per cent baseline, a White House official said, speaking on condition of anonymity. 'We will have deals. It takes time. Usually, it takes months and years; in this administration, it's going to take more like days,' White House trade counsellor Peter Navarro said on Friday on Fox Business. 'We are on task and on target.' The Office of the US Trade Representative (USTR) 'looks more like a deli now', Navarro said, with countries lining up for talks. USTR sent letters this week to trading partners reminding them of the deadline. It's unclear what all the frantic activity has yielded. Xi for months was reluctant to get on the phone with Trump and analysts speculated about what concessions the US president offered to his counterpart in exchange for the call. Trump at least appeared to give some ground on foreign students, saying it would be his 'honour' to welcome Chinese scholars even as his administration cracks down on student visas. German Chancellor Friedrich Merz visited Washington facing demands from his nation's automakers for tariff credits for vehicles they produce in the US. But the subject barely came up during the public portion of his meeting with Trump, who spent a large chunk of time unloading on Musk. 'We will end up hopefully with a trade deal or we will do something – you know, we will do the tariffs,' Trump said on Thursday alongside Merz. Merz, in his US visit, emphasised the integrated trade ties between countries that are at risk – including by personally driving a BMW built in South Carolina. The German leader said on Friday at an industry event the nations should agree on an 'offset rule' that would provide tariff relief for existing US production. Trump's UK deal – the lone pact so far – was undercut this week when he ploughed ahead with levies on steel and aluminium. The UK said the pact included an agreement for zero tariffs on British metals, but Trump's latest order kept a 25 per cent charge on them while negotiations continue and doubled the rate for others. Still, the upcoming Group of Seven summit of leaders from major economies could provide an opportunity for the type of in-person dealmaking Trump craves. Canadian Prime Minister Mark Carney has been discussing terms of a potential interim deal with Trump ahead of the gathering this month near Calgary. One theme is clear: Negotiations over his so-called reciprocal tariffs have grown intertwined with his separate duties on autos and metals, despite previous US signals that the administration considered them separate. 'He's entirely transactional,' Holtz-Eakin said of Trump. 'He will always deal.' Talks are ongoing with the EU, which has previously proposed an agreement with the US to mutually drop auto tariffs to zero as part of a broader trade framework, which the Trump administration rejected. The bloc subsequently suggested working towards zero-for-zero tariffs on cars, other industrial goods and some agricultural imports with tariff-rate quotas as a possible interim measure. Commerce Secretary Howard Lutnick said this week he'd consider some type of 'export credit' on autos, the kind of carve-out sought by Germany on vehicle tariffs. And he predicted there would be a US-India deal in the 'not too distant future.' Lutnick signalled, though, Trump's push for so-called reciprocity comes with caveats. The US would not agree with Vietnam to drop all tariffs, because it believes the South-east Asian nation is a hub for the so-called transhipment of Chinese goods. Talks with South Korea, where Trump spoke with newly elected president Lee Jae-myung, and Japan, which had top trade negotiator Ryosei Akazawa meet with Lutnick, continued this week. In yet another sign of the Trump team's frenetic approach, Nikkei reported that different – and even competing – positions among Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer and Lutnick had confounded Japanese counterparts. BLOOMBERG
Miami Herald
3 days ago
- Business
- Miami Herald
Trump's China gambit belies rocky road ahead on tariff deals
President Donald Trump has come up short on striking trade deals with most nations with just one month left before his self-imposed tariff deadline, even as he took his first steps in weeks toward engaging with China. Trump secured a much-desired call with Chinese President Xi Jinping, paving the way for a new round of talks on Monday in London - yet the diplomacy was overshadowed by a blowout public fight between Trump and his billionaire onetime ally, Elon Musk. Trump's aides insisted Friday that the president was moving on and focused on his economic agenda. Still, question marks remain over the U.S.'s most consequential trade relationships, with few tangible signs of progress toward interim agreements. India, which the Trump administration has cited as an early deal target, has taken a tougher line in negotiations and challenged Trump's auto tariffs at the World Trade Organization. Japan held another round of talks with the U.S., while also signaling it wants a reprieve from duties on cars and light trucks. The legal fight over Trump's tariffs hangs over everything. A court ruling striking down the country-by-country duties imposed using emergency authorities left partners with no certainty over what Trump's powers are. The next test could come as soon as next week, when a court could rule on the administration's appeal. Trump and his team were eager to draw attention to inroads with China as proof his ways are working. Trump on Friday described talks with Beijing as 'very far advanced' and said Xi had agreed to speed shipments of critical rare-earth minerals that were at the center of recent tension. Unlocking those supplies would spell relief for major American automakers. Chinese Vice Premier He Lifeng will visit the U.K. next week, during which he will conduct trade negotiations with the U.S., the Chinese foreign ministry said in a statement late Saturday. The mixed results in the talks so far demonstrate the highs and lows of Trump's mercurial approach to trade, in which he and aides have cast him as the ultimate decision-maker on any deals. Rather than provide a clear-cut victory, Trump's dealings with Xi also show the difficult road ahead with China. The rare-earths dispute revealed how important those supplies, which Beijing dominates, are for the U.S. economy. 'Xi is not letting go of the rare earths. He's got leverage, he's using it,' said Douglas Holtz-Eakin, president of the American Action Forum, a conservative think tank. 'They talked, that's the most important thing. I think they're really far apart.' The clock is ticking for Trump. His 90-day pause on higher tariffs for the European Union and nearly five dozen countries expires July 9 — barring an extension he could do with the flick of a pen — while China's reprieve extends until August. If deals aren't reached, Trump plans to restore tariff rates to the levels he first announced in April, or lower numbers that exceed the current 10% baseline, a White House official said, speaking on condition of anonymity. 'We will have deals. It takes time. Usually it takes months and years; in this administration, it's going to take more like days,' White House trade counselor Peter Navarro said Friday on Fox Business. 'We're on task and on target.' The Office of the U.S. Trade Representative 'looks more like a deli now,' Navarro said, with countries lining up for talks. USTR sent letters this week to trading partners reminding them of the deadline. It's unclear what all the frantic activity has yielded. Xi for months was reluctant to get on the phone with Trump and analysts speculated about what concessions the U.S. president offered to his counterpart in exchange for the call. Trump at least appeared to give some ground on foreign students, saying it would be his 'honor' to welcome Chinese scholars even as his administration cracks down on student visas. German Chancellor Friedrich Merz visited Washington facing demands from his nation's automakers for tariff credits for vehicles they produce in the U.S. But the subject barely came up during the public portion of his meeting with Trump, who spent a large chunk of time unloading on Musk. 'We'll end up hopefully with a trade deal or we'll do something - you know, we'll do the tariffs,' Trump said Thursday alongside Merz. Merz, in his U.S. visit, emphasized the integrated trade ties between countries that are at risk — including by personally driving a BMW built in South Carolina. The German leader said Friday at an industry event the nations should agree on an 'offset rule' that would provide tariff relief for existing U.S. production. Trump's U.K. deal - the lone pact so far — was undercut this week when he plowed ahead with levies on steel and aluminum. The U.K. said the pact included an agreement for zero tariffs on British metals, but Trump's latest order kept a 25% charge on them while negotiations continue and doubled the rate for others. Still, the upcoming Group of Seven summit of leaders from major economies could provide an opportunity for the type of in-person dealmaking Trump craves. Canadian Prime Minister Mark Carney has been discussing terms of a potential interim deal with Trump ahead of the gathering this month near Calgary. One theme is clear: Negotiations over his so-called reciprocal tariffs have grown intertwined with his separate duties on autos and metals, despite previous U.S. signals that the administration considered them separate. 'He's entirely transactional,' Holtz-Eakin said of Trump. 'He will always deal.' Talks are ongoing with the EU, which has previously proposed an agreement with the U.S. to mutually drop auto tariffs to zero as part of a broader trade framework, which the Trump administration rejected. The bloc subsequently suggested working toward zero-for-zero tariffs on cars, other industrial goods and some agricultural imports with tariff-rate quotas as a possible interim measure. Commerce Secretary Howard Lutnick said this week he'd consider some type of 'export credit' on autos, the kind of carve-out sought by Germany on vehicle tariffs. And he predicted there would be a U.S.-India deal in the 'not too distant future.' Lutnick signaled, though, Trump's push for so-called reciprocity comes with caveats. The U.S. wouldn't agree with Vietnam to drop all tariffs, because it believes the Southeast Asian nation is a hub for so-called transshipment of Chinese goods. Talks with South Korea, where Trump spoke with newly elected president Lee Jae-myung, and Japan, which had top trade negotiator Ryosei Akazawa meet with Lutnick, continued this week. In yet another sign of the Trump team's frenetic approach, Nikkei reported that different — and even competing — positions among Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer and Lutnick had confounded Japanese counterparts. --- (Akayla Gardner, Jennifer A. Dlouhy, Alberto Nardelli, Hadriana Lowenkron, Arne Delfs and Shiyin Chen contributed to this report.) Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Time of India
4 days ago
- Business
- Time of India
Trump's China gambit belies rocky road ahead on tariff deals
US President Donald Trump has come up short on striking trade deals with most nations with just one month left before his self-imposed tariff deadline, even as he took his first steps in weeks toward engaging with China. Trump secured a much-desired call with Chinese President Xi Jinping , paving the way for a new round of talks on Monday in London — yet the diplomacy was overshadowed by a blowout public fight between Trump and his billionaire onetime ally, Elon Musk. Trump's aides insisted Friday that the president was moving on and focused on his economic agenda. Still, question marks remain over the US's most consequential trade relationships, with few tangible signs of progress toward interim agreements. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like New Container Houses Indonesia (Prices May Surprise You) Container House | Search ads Search Now Undo India, which the Trump administration has cited as an early deal target, has taken a tougher line in negotiations and challenged Trump's auto tariffs at the World Trade Organization . Japan held another round of talks with the US, while also signaling it wants a reprieve from duties on cars and light trucks. The legal fight over Trump's tariffs hangs over everything. A court ruling striking down the country-by-country duties imposed using emergency authorities left partners with no certainty over what Trump's powers are. The next test could come as soon as next week, when a court could rule on the administration's appeal. Live Events Trump and his team were eager to draw attention to inroads with China as proof his ways are working. Trump on Friday described talks with Beijing as 'very far advanced' and said Xi had agreed to speed shipments of critical rare-earth minerals that were at the center of recent tension. Unlocking those supplies would spell relief for major American automakers. The mixed results demonstrate the highs and lows of the president's mercurial approach to trade, in which he and aides have cast him as the ultimate decision-maker on any deals. Rather than provide a clear-cut victory, Trump's dealings with Xi also show the difficult road ahead with China. The rare-earths dispute revealed how important those supplies, which Beijing dominates, are for the US economy. 'Xi is not letting go of the rare earths. He's got leverage, he's using it,' said Douglas Holtz-Eakin, president of the American Action Forum, a conservative think tank. 'They talked, that's the most important thing. I think they're really far apart.' The clock is ticking for Trump. His 90-day pause on higher tariffs for the European Union and nearly five dozen countries expires July 9 — barring an extension he could do with the flick of a pen — while China's reprieve extends until August. If deals aren't reached, Trump plans to restore tariff rates to the levels he first announced in April, or lower numbers that exceed the current 10% baseline, a White House official said, speaking on condition of anonymity. 'We will have deals. It takes time. Usually it takes months and years; in this administration, it's going to take more like days,' White House trade counselor Peter Navarro said Friday on Fox Business. 'We're on task and on target.' The Office of the US Trade Representative 'looks more like a deli now,' Navarro said, with countries lining up for talks. USTR sent letters this week to trading partners reminding them of the deadline. It's unclear what all the frantic activity has yielded. Xi for months was reluctant to get on the phone with Trump and analysts speculated about what concessions the US president offered to his counterpart in exchange for the call. Trump at least appeared to give some ground on foreign students, saying it would be his 'honor' to welcome Chinese scholars even as his administration cracks down on student visas. German Chancellor Friedrich Merz visited Washington facing demands from his nation's automakers for tariff credits for vehicles they produce in the US. But the subject barely came up during the public portion of his meeting with Trump, who spent a large chunk of time unloading on Musk. 'We'll end up hopefully with a trade deal or we'll do something — you know, we'll do the tariffs,' Trump said Thursday alongside Merz. Merz, in his US visit, emphasized the integrated trade ties between countries that are at risk — including by personally driving a BMW built in South Carolina. The German leader said Friday at an industry event the nations should agree on an 'offset rule' that would provide tariff relief for existing US production. Trump's UK deal — the lone pact so far — was undercut this week when he plowed ahead with levies on steel and aluminum. The UK said the pact included an agreement for zero tariffs on British metals, but Trump's latest order kept a 25% charge on them while negotiations continue and doubled the rate for others. Still, the upcoming Group of Seven summit of leaders from major economies could provide an opportunity for the type of in-person dealmaking Trump craves. Canadian Prime Minister Mark Carney has been discussing terms of a potential interim with Trump deal ahead of the gathering this month near Calgary. One theme is clear: Negotiations over his so-called reciprocal tariffs have grown intertwined with his separate duties on autos and metals, despite previous US signals that the administration considered them separate. 'He's entirely transactional,' Holtz-Eakin said. 'He will always deal.' Talks are ongoing with the EU, which has previously proposed an agreement with the US to mutually drop auto tariffs to zero as part of a broader trade framework, which the Trump administration rejected. The bloc subsequently suggested working toward zero-for-zero tariffs on cars, other industrial goods and some agricultural imports with tariff-rate quotas as a possible interim measure. Commerce Secretary Howard Lutnick said this week he'd consider some type of 'export credit' on autos, the kind of carve-out sought by Germany on vehicle tariffs. And he predicted there would be a US-India deal in the 'not too distant future.' Lutnick signaled, though, Trump's push for so-called reciprocity comes with caveats. The US wouldn't agree with Vietnam to drop all tariffs, because it believes the Southeast Asian nation is a hub for so-called transshipment of Chinese goods. Talks with South Korea, where Trump spoke with newly elected president Lee Jae-myung, and Japan, which had top trade negotiator Ryosei Akazawa meet with Lutnick, continued this week. In yet another sign of the Trump team's frenetic approach, Nikkei reported that different — and even competing — positions among Treasury Secretary Scott Bessent, Trade Representative Jamieson Greer and Lutnick had confounded Japanese counterparts.
Yahoo
28-05-2025
- Business
- Yahoo
Why the Social Security Trust Fund could go 'bankrupt in 8 years'
American Action Forum president and former Congressional Budget Office director Doug Holtz-Eakin explains why the Moody's US credit downgrade is more serious than past downgrades and how Social Security may force a broader fiscal reckoning. To watch more expert insights and analysis on the latest market action, check out more Catalysts here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
21-05-2025
- Business
- Yahoo
Trump turns populism on US companies in trade fight
President Trump is shifting the pressure to big companies to deal with rising costs from his tariff plan, leaning into populism as a tactic to sell his trade policy to Americans. Trump blasted Walmart on Saturday, saying the retail giant should 'just eat the tariffs' because it 'made billions of dollars last year,' and, in the process, undercutting his argument on the campaign trail that trading partners such as China will pay the tariffs. White House press secretary Karoline Leavitt said Monday that China will absorb the costs and called Walmart's warning about price increases as early as next month 'the most dire' forecast. The president urging retailers to not hike prices marks his latest strategy to avoid the blame with consumers for cost increases, even as CEOs and economists have warned about them. 'Having done something which is, I think everyone agrees, going to be very damaging on lower income Americans— these are highly regressive taxes— he now wants to appear to be on their side and align himself with the American consumer against the big, evil corporations,' said Douglas Holtz-Eakin, president of the center-right American Action Forum. 'The trouble is, it won't work,' he added. 'It's like being opposed to gravity. … They have a 3 percent margins in retail, and this is a 30 percent tariff. They cannot possibly eat the entire tariff.' The administration eased up on the trade war with China last week, lowering tariffs on imports from 145 percent to 30 percent for 90 days. Beijing, in response, matched the 115-point cut, lowering its retaliatory tariffs from 125 percent to 10 percent. Even with just the 30 percent in place, Walmart CEO Doug McMillon said in an earnings call that the company isn't 'able to absorb all the pressure' from the tariffs, announcing plans to increase prices as early as June. Along with calling on Walmart to 'eat' the extra costs, Trump issued a warning: 'I'll be watching, and so will your customers!!!' 'Trump is working the refs, as he always does, forcing businesses to consider both the economic costs and political costs of options,' one longtime lobbyist said. A second lobbyist, who is familiar with the retail sector, noted how tight margins are for stores of all sizes. 'Retailers, large and small, are in the same boat. If the cost of putting items on their shelves increases, they must raise prices to profit from their tight margins. It's a simple business: buy and sell stuff for a profit. Without the profit part, it's not a business,' that lobbyist said. In fiscal 2025, Walmart reported an operating income of more than $29 billion, which is about a 4.4 percent profit margin on revenue of $674.5 billion. It also imported about $49 billion worth of goods from China last year, which means a 30 percent tariff should be a roughly $15 billion hit. Holtz-Eakin said Trump is 'picking on the guys with the lowest margins' by calling out retailers to cover the cost for consumers. 'Both the wings of both the parties have this populist bent. … They don't respect the private system of private enterprise, and they don't rely on it to deliver the material wealth of the nation to the consumer. So, it's entirely consistent with that,' he said. 'And he's been leading the Republican Party in that direction for or years now. He was a lifelong Democrat. He still has the instincts of one.' Other companies have also announced price hikes due to the tariffs, including Mattel, Ford, Temu and Shein. Microsoft said it plans to increase the recommended retail prices of Xbox video game consoles and some controllers. Meanwhile, Home Depot is an exception, with Chief Financial Officer Richard McPhail telling CNBC it intends 'to generally maintain our current pricing levels across our portfolio.' A former Commerce Department official in Trump's first term argued Trump is mistaken about how to protect hardworking Americans, noting that 62 percent of U.S. adults own stock. 'Because Walmart is one of the most widely held retail stocks and it is a part of nearly everyone's 401(k) or IRA account, he is, in effect, asking Walmart to send the bill to their shareholders,' the former official said. 'That's actually worse than telling little girls to only have two dolls. It's telling autoworker retirees to live on less.' 'Shark Tank' investor Kevin O'Leary agreed that retailers are not going to 'eat the tariffs,' even if Trump wants them to. Instead, he expects both customers and retailers to shoulder some burden of the cost increases. 'There's going to be some distribution of the pain between increased prices, and retailers will take some of the hit, but it really depends what the hit is,' he said in an interview on NewsNation's 'The Hill.' 'We don't know — is it 10 percent, 20 percent, 25 percent? What is it? Nobody knows.' When Trump pitched the idea of tariffs on the campaign, he said they are a way to stop being ripped off by foreign countries and argued other countries pay tariffs, not U.S. consumers. The idea of reciprocal tariffs was for trading partners to be charged what they charge the U.S., Trump said. 'This is one of the most important days, in my opinion, in America's history,' Trump said on 'liberation day' on April 2. 'It's our declaration of economic independence.' The 'reciprocal' tariffs on trading partners were then paused a week later, for 90 days, amid pressure from Wall Street and Republicans because of the turbulence in the stock market. But when he initiated the pause, Trump imposed a 10 percent tariff on all foreign nations other than China. The administration has been in talks with trading partners since the 90-day pause took effect, and Treasury Secretary Scott Bessent warned Sunday that tariffs on trading partners could go back to the April 2 rate if they don't engage in good-faith negotiations. Bessent, though, was not completely on track with Trump. He said on CNN's 'State of the Union' that he spoke to McMillon after the Walmart earnings call and added that he's also calling on companies to absorb some of the tariffs. But, he warned consumers will feel a hit as well. 'Walmart will be absorbing some of the tariffs, some may get passed on to consumers,' Bessent said. Copyright 2025 Nexstar Media, Inc. All rights reserved. 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