Donald Trump has sparked competition for trade agreements to oppose US tariffs

The United States’ economic partners are scrambling to maintain trade under Donald Trump by forging new bilateral deals and reshaping supply chains.

Policymakers and business experts say countries are moving toward a strategy that was put in place when other trade deals were signed during the president’s first term as the world’s largest consumer economy stalled.

Since Trump’s election in November, the European Union has renewed a long-awaited trade deal with South America’s Mercosur group, updated a free trade agreement with Mexico and reopened negotiations with Malaysia that have been stalled for more than a decade.

Trump Meanwhile, in his first days in office, he threatened up to 100 percent tariffs on China, 25 percent Canada and MexicoAnd he said he would consider blanket tariffs on all US goods. The US government has ordered agencies to investigate business cases, including money laundering and counterfeit goods.

Malaysia’s Trade Minister Tengku Zafrul Aziz told the Financial Times that Trump’s return “could certainly prompt countries to further expand their trade portfolios.”

Aziz In 2018, he cited the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which was continued by 11 members after Trump withdrew the United States from the negotiations. The deal showed the resilience of countries willing to cooperate even in the absence of traditional economic leaders like the US, he said.

EU Trade Commissioner Maroš Šefčovič told the World Economic Forum in Davos that his diary is full of meetings with Gulf states and other ministers. “There is a great desire” to make agreements with the European Union, he said.

In the next few months, the entire group of commissioners will visit India to make progress on trade negotiations and technology partnerships.

A European official said: “The countries that are proactively implementing agreements are doing so independently of the US situation. There is a huge gap between what Washington wants to do and what is actually happening on the ground.”

During Trump’s first term, the EU signed deals with Japan — a staunch US ally that fears the economic fallout from the policy — Singapore and Vietnam, and began talks with New Zealand and Chile, which it eventually finalized. One EU official joked that the president was “the best EU trade commissioner ever”.

“There were a lot of deals,” said Cecilia Malstrom, the EU’s trade commissioner during Trump’s last term in office, who previously played a major role in the Mercurial negotiations. “We thought, it’s a tough world. We don’t believe in trade wars. We have an unknown president who is imposing tariffs everywhere. Let’s see what we can do together.

The current maelstrom with the Covington & Burling law firm is that a deal with Mexico and negotiations with Australia, Indonesia and possibly the Philippines and Thailand are expected to be completed within Trump’s four-year term.

Bernd Lang, chairman of the European Parliament’s trade committee, said the EU’s response to Trump would combine retaliatory tariffs with other deepening trade ties. “In addition to defending ourselves, we must further strengthen our partnerships with third countries such as the UK, Mexico, Japan or Canada.”

This means ratifying trade agreements such as the EU-Mercosur and concluding negotiations with partners such as Australia and Indonesia.

In the year By 2020, ASEAN countries and China, Japan, Korea, Australia and New Zealand will establish a regional comprehensive economic partnership. RCEP mainly reduced non-tariff barriers to trade, such as animal control and customs procedures. RCEP covers 2.3 billion people and 30 percent of global GDP, compared to 25 percent in the US.

The African Continental Free Trade Area, which will eliminate 90 percent of tariffs over time, is set to begin in 2021.

Trade in goods and services It has continued to grow in recent years despite the Covid-19 pandemic and rising immunity.

Scott Lichicom of the Cato Institute, a Washington-based think tank, said: “Regardless of what Donald Trump does in the next few years, not everyone seems willing to accept costly economic isolation and would rather just continue without us.” In the year By mid-2024, nearly 370 trade agreements will be in force with no sign of a reversal in the near future.

China has recently signed agreements with Serbia, Cambodia, Nicaragua and Ecuador. Beijing, which Trump sees as America’s biggest rival, accounts for 30 percent of the world’s GDP.

A senior trade official, speaking on condition of anonymity, said they were “more skeptical at this point” because the remaining deals were difficult to negotiate.

“Trump’s return could spur new bilateral ties, perhaps in Africa. But Asia has expanded a lot. I’m holding on.”

Additional reporting by Aimee Williams in Washington

Data visualization by Janina Conboye in London