From lying low to outright retaliation, a former U.S. trade negotiator lists out the options available to world leaders.
Countries must now formulate response plans based on their national interests while also taking into account factors such as overall relations with the United States, obligations under the World Trade Organization (WTO), shifting supply chains, areas of potential negotiating leverage, and fears of further U.S. retaliation. The tariff announcement by U.S. President Donald Trump on April 2 has fueled intense discussions in capitals around the world on the best way to respond. Initial statements by foreign leaders and trade ministers have conveyed such feelings as surprise, regret, dismay, and betrayal. Not only did Trump's tariffs go far beyond market expectations, but they also seem to have targeted U.S. partners and allies most acutely. The tariff announcement by U.S. President Donald Trump on April 2 has fueled intense discussions in capitals around the world on the best way to respond. Initial statements by foreign leaders and trade ministers have conveyed such feelings as surprise, regret, dismay, and betrayal. Not only did Trump's tariffs go far beyond market expectations, but they also seem to have targeted U.S. partners and allies most acutely. Countries must now formulate response plans based on their national interests while also taking into account factors such as overall relations with the United States, obligations under the World Trade Organization (WTO), shifting supply chains, areas of potential negotiating leverage, and fears of further U.S. retaliation. China has moved quickly down the retaliation route. Other countries, such as Vietnam, have signaled the possibility of unilateral tariff cuts and a strong interest in negotiation. The European Union is also talking about the need to reach a fair deal while noting that it is prepared to retaliate should negotiations fail. There is no one-size-fits-all approach for countries to respond to Trump's tariffs. Instead, drawing on my nearly three decades as a negotiator in the Office of the U.S. Trade…