- The US is heading to the G7 meeting in Canada all alone as other countries fume at a new set of steep tariffs on steel and aluminium that risk derailing global trade relations.
- The only thing that will fix the damage the Trump administration has done to the US relationship with its closest allies is a change of guard in the US government, according to Sebastian Mallaby at the “Council on Foreign Relations.”
- US allies will “be looking forward to the day when there’s a different government in the United States,” Mallaby told reporters during a press call.
- CFR’s Edward Alden warned relations with Canada and Mexico may be tougher to rekindle Trump’s repudiation of NAFTA: “It’s a little worse within North America.”
That’s pretty much the only way to restore America’s friendships with traditional allies like Canada, Mexico, and the European Union, which have been blindsided by President Donald Trump’s aggressive trade restrictions, including steep tariffs on steel and aluminium.
As Trump heads to Canada for this week’s meeting of the G7 Group of Nations, the general consensus is that this is more like a G6 plus one – with the US under Trump the odd country out.
“Is there a future for the G7? So long as the US government persists on its present course where the instinct is to undo anything that is already there,” said Sebastian Mallaby, senior fellow at the Council on Foreign Relations, in a phone call with reporters ahead of the weekend summit.
“If there were to be a different US government with a different agenda the [relationships] would come back really quickly” because of the US economy’s massive size and the dollar’s preeminent role in global finance.”
US allies will “be looking forward to the day when there’s a different government in the United States,” he said.
However, Edward Alden, also a CFR senior fellow, said repairing relations with our immediate neighbours Mexico and Canada, who had felt NAFTA would shield them from the American government’s more extreme protectionist measures, have found themselves essentially abandoned.
“It’s a little worse within North America – the underlying bargain was that US neighbours would receive special treatment,” Alden said in the same press call. “Both Canada and Mexico have believed that their economic interests would be protected to some extent by the US government. With both countries that expectation has been quite seriously damaged.”
Ian Bremmer, head of the political risk firm Eurasia Group, stated the state of US-relations with its allies succinctly in the following devastating tweet:
As for the prospect of new trade deals touted by the Trump administration, Alden says they are a pipe dream.
“Any possibility of negotiations is going to be on hold for a period of time,” he said.
“The countries are all going to retaliate – what you will get is a period of time where each of the countries is going to have to evaluate the impact of the new tariffs. I expect the Trump administration will double down and try to impose more tariffs,” he added.
Because the US has vowed to ignore the rules of the global trading system that it helped put into place, including the World Trade Organisation, trade deals are stalled for the foreseeable future.
“These issues are too fundamental for the World Trade Organisation process to resolve,” said. “They’re going to have to be negotiated by the countries themselves. The WTO is in an no win situation.”
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