President Donald Trump is hiking global tariffs to levels not seen in a century — without triggering a major trade war. But it’s unclear what else his trade negotiations will yield, despite big promises that he and other leaders are making.
The White House has claimed, triumphantly, that the verbal agreements the administration has reached in recent days with major trading partners like the European Union, Japan, the Philippines and others will result in major new trade opportunities for U.S. industries and unprecedented sums of foreign investment into the country.
But there are already signs that the EU, Japan and other governments can’t guarantee the private-sector investments in the U.S. they have promised, and have competing interpretations of other major provisions of the deals as well.
The disagreements and lack of specifics — or written agreements of any kind — on the trade deals the White House has rolled out in recent weeks are raising doubts about how much Trump has really succeeded in lowering foreign barriers or drawing in foreign investment for U.S. businesses, even as he dramatically expands the protectionist policies that decades of American leaders had sought to knock down.
That could prove a problem for some in Trump’s own party, particularly free market Republicans who have given the administration leeway for his on-again, off-again tariff strategy, in the hope that it will ultimately expand markets for exporters in their home states and districts.
“I want to see the text and classified annexes of some of these agreements,” Sen. Thom Tillis (R-N.C.) said last week. “Because it’s really important.”
Of the six agreements Trump has reached with leading trade partners, only one is signed. The Trump administration also reached a separate understanding with China to temporarily halt an escalating trade war, with a negotiating deadline extended to Aug. 12.
The one signed agreement, inked with the U.K. in May, was also light on details, with the implication that the two governments would negotiate further to implement the high-level commitments they made. For example, the British government is still pressing for the U.S. to make good on its commitment to eliminate tariffs on steel and aluminum. The two countries are also still haggling over restrictions on agricultural goods and other key sectors.
The remaining agreements — with the EU and several Asian countries — have yet to be committed to paper. Instead, Trump disclosed the deals on social media following a phone call or face-to-face meeting with his foreign counterpart, as the White House rushes to meet a self-imposed Aug. 1 deadline to reach deals or impose far higher tariffs on dozens of trading partners. The terms Trump has outlined aren’t always echoed by the other party to the deals.
In announcing the EU trade deal at one of his golf courses in Scotland on Sunday, for example, Trump indicated that Europe would be lowering its tariffs on U.S. goods to zero. But the EU later said it only applied to some products, like commercial aircraft and their components, while tariffs on industrial goods and agricultural products are still being worked out by the two countries.
The U.S. tech industry expressed disappointment Monday that the framework agreement didn’t address EU digital regulations and taxes, as well.
“We strongly urge the White House to redouble its efforts to address EU policy and regulatory barriers to US digital and services trade, especially those that target US firms and treat them unfairly,” said Christine Bliss, the president of the Coalition of Services Industries, which represents Microsoft, Amazon, Google and Facebook, among other tech companies.
Trump said Sunday that the EU would also buy “vast amounts” of American weapons worth “hundreds of billions,” but on Monday, European officials quietly clarified nothing concrete on arms had been agreed.
“Arms procurement is not a matter for the Commission,” one senior EU official told reporters. “This was more an expression of expectation on the part of President Trump that the increased defense expenditure would benefit U.S. defense companies … But it was not calculated in any way into the figures we talked about.”
A senior European Commission official also acknowledged that the EU’s commitment to make $600 billion in new investments in the U.S. by 2028 is “based on the intentions of the private companies,” over which Brussels has no authority. And experts say it will be virtually impossible for EU member countries to purchase $750 billion in U.S. energy, another aspect of the deal reached by European Commission President Ursula von der Leyen and Trump.
Hitting that target would require the EU to triple its U.S. energy imports, based on last year’s figures, while asking American firms to divert all their energy flows worldwide towards the bloc instead — and then some.
“So many terms are left to be discussed,” Daniel Mullaney, a former assistant U.S. Trade Representative who served under Democratic and Republican presidents, said of the deal with the European Union. “We don't know the details of the agreement. … I imagine it will be somewhat general, and it will indicate a direction for further travel.”
There are similar questions around Japan’s pledge to invest $550 billion in the U.S., a move that Trump heralded as unprecedented. A White House official confirmed that details were still being worked out on the Japan deal.
"It would effectively be an investment vehicle funded by Japan that would be deployed, at the president’s direction, to fund investment in sectors of importance,” said the official, who was given anonymity to discuss details of the deal not yet made public. “This is not a mere commitment for Japan to purchase commodities or Japanese companies to steer investments worth $550 billion into the U.S. It’s Japan fronting the cash to finance most likely private sector projects.”
That’s not exactly how Japanese Prime Minister Shigeru Ishiba described it in a press conference late last week, where he said the money would include “loans and investments” but did not elaborate further, pending a report from Minister of State for Economic and Fiscal Policy Ryosei Akazawa.
“The $550 billion — we still don’t know how it looks,” Kristi Govella, Japan Chair at the Center for Strategic and International Studies, a D.C.-based think tank, said in an interview. “On the Japanese side, it seems to be described as more of a company-led endeavor that the Japanese government supports with loans and other assistance.”
If and when the deal is formalized in writing, it will have to win approval in Japan’s parliament, which is not guaranteed, given that the body will soon see an influx of populist lawmakers from the far-right Sanseito party, who won elections earlier this month by promising to focus on “Japanese First.”
“It depends largely on which of these decisions have to go through the legislature for approval,” Govella said of the trade deal. “But it really depends on the details, which we don’t really have at the moment.”
Vietnam, meanwhile, has still not confirmed the U.S. tariff rate that Trump claimed the country agreed to in an announcement he made on social media earlier this month. The White House has yet to release details of the deal with the Philippines the president unveiled July 22, including any clarity regarding a vague promise to “work together Militarily,” as Trump posted on Truth Social.
The Indonesian government, meanwhile, is disputing the claim, included in a White House statement released last week, that it agreed to “remove restrictions on exports to the United States of industrial commodities, including critical minerals.”
That seemed to indicate the government would roll back its ban on the export of nickel ore, which is used to make stainless steel. However, Indonesia Chief Economic Affairs Minister Airlangga Hartarto told reporters in Jakarta one day after the deal was announced that Indonesia would only be exporting “processed minerals,” not the raw nickel ore itself. If true, U.S. steel industry officials say that would make the deal far less significant from their point of view.
Asked about the discrepancy, Trump administration officials pointed back to the joint statement to emphasize that Indonesia had agreed to lift the ban on nickel ore.
“These countries made these agreements," the White House officials said. "We expect them to abide by their commitments and if they reneg, the president reserves the ability to raise their tariffs again.”
The deals Trump has reached have made some gains on historically thorny issues surrounding U.S. exports. Tokyo has committed to importing more U.S. rice — which is culturally sensitive in Japan — and the EU promised to eliminate tariffs on U.S. cars, which should help German companies that manufacture in the U.S.
Indonesia, too, promised to adopt U.S. vehicle standards, which could ease the way for American auto companies to sell more cars to the country of more than 281 million people. And the Philippines also promised to eliminate all of its tariffs on certain U.S. goods, like autos.
The most significant development, however, is that Trump has effectively reset the United States’ role in the global trading system, with little retaliation so far from trading partners or blowback from financial markets. Over close to a century now, the U.S. kept its tariffs around 2 percent, part of a system it helped create after World War II to foster integrated global supply chains, lower prices and expand consumer choice.
Trump’s duties have also led to an influx of new tariff revenue — paid by the people and companies importing foreign goods (and not, as Trump regularly asserts, foreign governments) — coming into the country. In just a few months, the tariffs have brought in more than $136 billion, with the higher rates still yet to take effect.
And, on the whole, Trump’s trade policies have yet to drive a surge in consumer prices, with inflation just starting to tick up in July. That’s thanks in part to the fact that companies loaded up on inventory early in the year and some have thus far absorbed the costs. Consumer sentiment has slightly improved over the past two months, further emboldening the White House.
Foreign governments too, are now acquiescing, reluctantly, to duties that are exponentially higher than what they faced up until now — and which would have likely triggered major trade retaliation and plunges in the markets if Trump hadn’t threatened to impose far steeper tariffs in a matter of days.
“I observed this a few months ago, that the American approach has changed,” Canadian Prime Minister Mark Carney told reporters Monday. “It is no longer an approach that hinges on integration. It's a tariff-based approach for several sectors.”
Chris Lunday contributed reporting from Berlin, Laura Kayali contributed from Paris, Gregorio Sorgi contributed from London and Victor Jack contributed from Brussels.
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