Trump's trade talks intensify with tariff deadline fast approaching
TACO or tariffs? An August 1 deadline looms after the European Union became the latest of the top US trading partners to reach a deal with Trump.
WASHINGTON ‒ With President Donald Trump's Aug. 1 tariff deadline fast approaching, countries whose exports are facing stiff fees have been in a scramble to ink trade deals with the United States that preserve as much access as possible to American markets.
The European Union and its 27-member nations bloc became the latest of the United States' top trading partners to come to an agreement with Trump over the weekend, joining the Philippines, Japan and Indonesia in announcing deals during July. The United Kingdom and Vietnam have also reached agreements with Trump.
Canadian Prime Minister Mark Carney said this week that his country was in the "intense phase" of the complex negotiations, as it sought to avert a promised 35% tariff on imports that fall outside of an existing trade pact with the United States.
"There is a landing zone that's possible, but we have to get there. We'll see what happens," Carney told reporters during a July 28 news conference.
'No more extensions,' Trump administration warns
A baseline tariff of 10% is in place for most countries, some two dozen of which received letters from Trump this month informing them that higher rates are on the way. They include Brazil, which Trump says he'll hit with a 50% tariff, and India, which he said he'll apply a 26% rate to, as well as Canada, at 35%, and Mexico, which faces a 30% tariff.
Mexico, Canada and the EU are the largest exporters of goods to the United States, along with China, which is in separate trade talks with the Trump administration and faces a later deadline in August.
First announced on April 2 by Trump in the Rose Garden, the implementation of the so-called “reciprocal tariffs” was twice extended to stabilize the markets and give the president's team more time to conduct negotiations. The constant deadline shifting has given birth to an acronym: TACO, for Trump Always Chickens Out, mocking the second-term president's on-again-off-again tariff policies.
But countries hoping for another reprieve won't be so fortunate, Commerce Secretary Howard Lutnick said on July 27.
“No extensions, no more grace periods. Aug. 1, the tariffs are set; they’ll go into place. Customs will start collecting the money, and off we go,” Lutnick said on “Fox News Sunday.”
EU latest to strike trade deal with Trump
Just ahead of the deadline, on July 27, the EU struck a deal with Trump. European Commission President Ursula von der Leyen and Trump finalized the agreement in person while the U.S. president was in Scotland.
The deal includes a 15% tariff on most European exports to the United States, a reduction from the 30% Trump had threatened to impose earlier in July.
“We just had a very big trade deal, the biggest of them all yesterday,” Trump said during a bilateral meeting in Scotland on July 28 with U.K. Prime Minister Keir Starmer at Trump Turnberry golf course.
The agreement includes $600 billion in EU investments in the United States and the purchase of $750 billion worth of U.S. energy. Tariffs on steel and aluminum will remain at 50%.
On July 22, Trump also announced a “massive deal” with Japan under which the United States would impose a 15% tariff on Japanese imports. Trump had previously threatened a 24% tariff on Japan.
He said Japan would invest $550 billion in the United States and America would receive 90% of the profits, without offering any details. Trump's announcement also said Japan had agreed to open its markets to imports of vehicles, rice and other agricultural products from the United States.
The U.K. was the first country to reach a trade agreement with the United States in May. A reciprocal tariff of 10% remains in effect, in keeping with the baseline tariff rate.
Under the deal, the first 100,000 vehicles imported into the United States by U.K. car manufacturers each year are subject to the reciprocal rate of 10% and any additional vehicles each year are subject to 25% rates, the White House says. The U.K. is one of the only countries with which the United States has a trade surplus.
Trump has also announced deals with Indonesia, Vietnam and the Philippines.
'We've made the big ones,' says Trump
Pakistan's foreign minister said on July 25, after a meeting with Secretary of State Marco Rubio, that his country was "very close" to reaching a deal with the United States and one could emerge in days.
South Korean officials were also in Washington on July 25 for negotiations with Lutnick and other Trump administration officials.
Trump signaled during his meeting with Starmer on July 28 that he'd landed most of the deals he expected to and his patience was waning for individual talks.
"We're going to be setting a tariff for essentially the rest of the world and that's what they're going to pay if they want to do business in the United States. Because you can't sit down and make 200 deals," Trump declared. "But we've made the big ones."
One of the last outstanding agreements of significance is an unfinished deal with China.
After rounds of tit-for-tat tariffs that saw the United States hike fees on imports to 145% and China put tariffs of 125% on U.S. goods, the two nations called a truce in May, agreeing to a 90-day suspension of the levies.
Negotiators from both countries met in Stockholm on July 28 for another round of discussions, with the clock ticking toward the Aug. 12 expiration of the temporary truce between the top economies.
"We have a good relationship with China, but China is tough," Trump said during his meeting with Starmer in Scotland.
(Correction: An earlier version of this story misspelled the first name of United Kingdom Prime Minister Keir Starmer.)