A year ago, President Donald Trump declared “trade wars are good and easy to win.” The White House has since moved toward its goal of revamping global trade deals, largely through a series of tariffs on — and talks with — China.
While the president’s protectionist moves scared some businesses, farmers and lawmakers, Trump has progress to show from his year of trade maneuvers. Last fall, he agreed to revise the North American Free Trade Agreement with Mexico and Canada. The Trump administration also thinks it is close to a new deal with Beijing after talks last month.
Potential pitfalls await, despite the waiving of what had been the deadline this weekend for a U.S.-China agreement. The U.S. still needs to hammer out the thorny points of a deal with Beijing, such as enforcing punishment for intellectual property theft. Trump also has to persuade Congress to approve the so-called United States Mexico Canada Agreement, as Democrats show skepticism about labor and environmental protections in the deal.
Trump’s trade war tweet on March 2, 2018, sent fears through financial markets.
Despite rough stretches for stocks driven in part by fears about a widening trade war with China, the S&P 500 has climbed nearly 4 percent since then.
Now, businesses and investors hold out hope that progress translates into a concrete deal with China and an easing of tariffs. Late last month, Trump delayed plans to increase tariffs on $200 billion in Chinese goods to 25 percent from 10 percent, citing “substantial progress” in the latest talks with Beijing. He said the world’s two largest economies would plan a summit to “conclude an agreement” assuming “both sides make additional progress.
The U.S. has put tariffs on $250 billion in Chinese goods so far. Beijing has put duties on $110 billion in U.S. products.