It would reach Himalayan heights of foolishness for Canada, China and Mexico to assume they’ve seen the last of Donald Trump raising tariffs. This week their governments all coped with the threat rather well. To forestall the threat of 25 per cent import taxes, Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau executed what I call the “soyabean shuffle”. The term recalls the then European Commission president Jean-Claude Juncker forestalling car tariffs in 2018 by promising Trump that Europe would buy more US soyabeans, which it already was.
Mexico and Canada this week announced the deployment of troops and border staff who were largely there already to combat the flow — minimal in Canada’s case — across the border of the opioid fentanyl. China imposed modest rises in energy tariffs, more clampdowns on exports of critical minerals (which have never really worked) and a vaguely worded investigation into Google.
But Trump will come back for more, and broaden his targets to include the EU and middle-income economies aside from China. He has a particular animus against Vietnam, which he correctly views as a supply chain stop-off and offshore production platform for China. Exporters cut out of the US must find new markets.