Trump says no pause on tariffs, but open to negotiations

WASHINGTON – US President Donald Trump said he wasn’t considering a pause on

his plan to implement sweeping additional tariffs

on dozens of countries despite outreach from trading partners eager to avoid the levies, while still signaling he could be open to some negotiations.

“We’re not looking at that,” Mr Trump said on April 7 while meeting with Israeli Prime Minister Benjamin Netanyahu in the Oval Office.

Mr Trump said tariffs were “very important” to his economic agenda – and would generally remain – while opening the door to “fair deal and good deals with every country.” “There can be permanent tariffs and there can also be negotiations because there are things that we need beyond tariffs,” he added.

Mr Trump’s comments follow mixed messages from the president and his top officials about the administration’s willingness to negotiate with trading partners, with a 10 per cent levy on all countries already in effect and targeted reciprocal import taxes set for April 9. That uncertainty has fueled volatility in global markets and sent foreign leaders frustrated by Mr Trump’s approach rushing to secure deals with the US. 

In the meeting, Mr Netanyahu said his country would work to eliminate trade barriers and deficits with the US.

“We will eliminate the trade deficit with the United States,” Mr Netanyahu told reporters. “We intend to do it very quickly. We think it’s the right thing to do. And we’re going to also eliminate trade barriers.”

But, underscoring the difficulty of divining Mr Trump’s intentions, the president said even that might not be enough for him to reduce tariffs on the longtime US ally.

“Maybe not, don’t forget – we help keep Israel alive,” Mr Trump said, adding that the US gives Israel “billions of dollars a year” in defense assistance. Minutes later, Mr Trump said “we do take care of our friends.”

Asked directly if it would be possible for countries to reduce their tariffs below the flat 10 per cent floor, Mr Trump sidestepped the question while emphasising what he saw as the benefits of the levies.

“Tariffs will make this country very rich,” Mr Trump said.

The yo-yo approach with one of Mr Trump’s closest political allies illustrated the chaotic approach that has befuddled markets, and the difficulty facing even one of the US’s staunchest partners.

Mr Trump did signal that some nations would face significant challenges in getting the tariffs removed. He reiterated his threat to

impose “additional” 50 per cent tariffs

on China if Beijing did not withdraw a 34 per cent retaliatory duty on US goods. And after earlier in the day speaking with Japanese Prime Minister Shigeru Ishiba to open Cabinet-level trade talks, Mr Trump on April 7 railed against the country’s barriers on US agricultural products.

Mr Netanyahu is the first foreign leader to visit the White House since the US president last week unveiled a new slate of levies on other nations that have sent global markets into a tailspin and raised fears of a recession. 

Mr Netanyahu’s visit and his ability to secure a deal with Mr Trump that could spare his country in the trade fight was being closely watched by other US trading partners, hopeful that an agreement between those countries could provide a framework for other nations. Mr Netanyahu expressed optimism that Israel could “serve as a model for many countries” on how to approach the trade dispute.

Mr Trump has set a high bar for any agreements, saying last week that he was open to tariff cuts in return for “phenomenal” offers and on April 6 claiming that other countries would need to eliminate bilateral trade deficits and non-tariff barriers.

“They make barriers that are so tough that it’s impossible to qualify,” Mr Trump said. “So tariffs are a big part of it, but there’s another big part of it and that’s barriers, they also do something else they manipulate their currency, and they drive it down.”

Asked about an offer from the EU that would see them bring tariffs on cars and industrial goods down to zero, Mr Trump said that concession would not be enough and reiterated his concern about the US deficit with the trading bloc.

“The EU has been very tough over the years. It was, I always say it was formed to really do damage to the United States in trade. That’s the reason it was formed,” he said. “They formed together to create a little bit of a monopoly situation to create a unified force against the United States for trade.”

“We have a deficit with the European Union of US$350 billion – it’s going to disappear fast,” Mr Trump vowed.

The Trump, Mr Netanyahu meeting capped a tumultuous day that saw US stocks swing wildly over a swirl of headlines related to Mr Trump’s trade policies, wiping out a 4 per cent plunge to rise more than 3 per cent before turning negative again. The tumult was made worse by an erroneous report about Mr Trump’s willingness to consider a tariff pause, which the White House denied. BLOOMBERG