President Trump touted his trade agenda Wednesday, writing in a Twitter post that his tariffs are “leading to great new trade deals.”
But so far, he has yet to finalize any trade deals.
Trump has put hefty extra taxes on certain imports coming from China, Canada, Mexico, Japan, South Korea, Turkey, the United Kingdom and the European Union. Most of these nations were outraged by the tariffs, and their leaders called or met with Trump to express their frustration. Nearly all of the foreign leaders then proceeded to hit back at Trump by putting tariffs on some U.S. products like soybeans, Harley-Davidson motorcycles and whiskey.
The result is that just over a year-and-a-half into his presidency, Trump has achieved an escalating trade war and some heated conversations about trade, but no actual deals have been signed. The Trump team argues that the tariffs are giving them leverage in trade negotiations and any short-term pain from the tariffs will eventually be worth it, but they have yet to see results.
“President Trump has only imposed tariffs. He has yet to get any other countries to remove their tariffs or to remove his own tariffs,” Chad Bown, a trade expert at the Peterson Institute for International Economics, wrote on Twitter. “There are not yet any trade deals. None.”
The closest Trump has come to a genuine deal is with South Korea and the European Union, longtime political, military and economic allies of the United States. The Trump administration put out an announcement in March saying an agreement with South Korea had been reached “in principle.” In July, the White House said the United States and European Union would “work together toward zero tariffs” and start an “executive working group” to hopefully reach a deal. Neither deal has been finalized on paper yet, let alone signed by both sides. Trade experts say a sweeping agreement with the European Union could take years.
South Korea was supposed to be the model trade deal. The Trump administration hinted nearly a year ago that it would withdraw from the free trade deal with South Korea, known as KORUS, if Korean leaders didn’t agree to concessions. On March 23, Trump hit several nations with a 25 percent tariff on steel and a 10 percent tariff on aluminum sent to the United States. South Korea was initially exempted because the White House said the trade negotiation was progressing well, but the threat was there that the tariffs could go into effect.
The South Korean government seemed eager to negotiate and put this behind it. By March 27, the White House and South Korea announced the framework of a deal where South Korea would lower barriers so more U.S. cars could be sold there. South Korea also agreed to reduce its sales of steel to the United States by 30 percent in exchange for Trump removing the tariff.
Top White House officials such as Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert E. Lighthizer made the television rounds to herald the deal as proof that the Trump trade agenda was working, calling it “historic” and an “absolute win-win.” Trump tweeted it was a “great deal.”
Yet nearly five months later, the deal has not been finalized, a time-frame trade experts say is getting long for what appeared to be a straightforward tweak to an existing deal. The hold-up, according to South Korean lawmakers and former U.S. trade officials, is Trump’s new threat to put tariffs on foreign-made cars and trucks. South Korean companies like Hyundai and Kia sell a lot of cars in the United States, and South Korean leaders thought their country would be excluded from any further tariffs if they signed a revised KORUS with the Trump administration.
“The Koreans learned that even if you reach an agreement with the Trump administration, they might hit you again with something later to get more,” said Troy Stangarone of the Korea Economic Institute.
Several senior Trump administration officials not authorized to speak publicly about the ongoing negotiations say they are optimistic the deal will be finalized soon. Lighthizer met with his Korean counterpart in late July, but Lighthizer has been stretched in many directions as the White House is dealing with many trade battles. He is the lead negotiator with Mexico on a revised North American Free Trade Agreement (NAFTA), which has been the dominant discussion topic in August.
The auto tariff investigation is under the purview of the Commerce Department, not Lighthizer’s team, another complication as the United States tries to iron out details with South Korea. A USTR spokesman declined to comment on the auto tariff investigation, indicating it wasn’t in USTR’s purview, even though the issue is playing into KORUS discussions.
Deals with other nations remain even more elusive. Negotiations with China and Canada, the two largest U.S. trading partners, have stalled this summer as substantial disagreements endure and foreign leaders say Trump is being unreasonable and they don’t understand what he really wants.
Revising NAFTA has been a top Trump priority since his presidential campaign began, and he’s repeatedly called it one of the “worst deals in history.” In recent days, senior administration officials have said an agreement in principle is close between the United States and Mexico, but no announcement has been made yet and Canada has been left out of the talks, a major hurdle to getting all three parties to agree.
Lawmakers on both sides of the aisle have been vocal about their frustration with the tariffs and lack of tangible progress. Democratic senators Ron Wyden (Ore.) and Robert Menendez (N.J.) sent a letter on July 27 to the State Department asking to see a copy of the modified KORUS agreement, saying the Case-Zablocki Act requires the secretary of state to send Congress the text of any international agreement “no later than 60 days” after the agreement is reached. They asked for a response by this Friday and have not heard anything yet.
“The lesson for anybody here is to nail down the details with the Trump administration,” said Bruce Hirsh, a former U.S. trade negotiator. “The Koreans ended up being surprised.”