Sarah Holder (2:05)

The Trump administration has also asked the US Trade Representative to launch new accelerated Section 301 investigations, which would allow the US to impose retaliatory tariffs on countries whose actions it deems unreasonable or discriminatory against US Trade. For US Trading partners around the world, it's causing tariff whiplash all over again. On Monday, the European Union postponed a vote on the trade deal it negotiated with the US Late last year, saying it needs clarity on the Trump administration's trade policies. First, India's trade delegation has also postponed a trip to the US to finalize a trade deal which had been set for later this week.

Brendan Murray (2:50)

I don't think we're going to see completely fully renegotiated deals, but the countries that are in this process are going to want to know the details of what they're going to roll out before they sign on the dotted line. Anything with the Trump administration.

Sarah Holder (3:05)

Brendan Murray oversees Bloomberg's trade coverage from London.

Brendan Murray (3:08)

If you're sitting in Brussels or Beijing right now, you're saying perhaps maybe we have more leverage than we did last week.

Jenny Marsh (3:18)

If you're Beijing, you're sort of now on a level playing field with US Allies.

Sarah Holder (3:22)

And Jenny Marsh oversees Bloomberg's coverage of greater China's economy and politics.

Jenny Marsh (3:27)

You've gone from the biggest target when Trump first came in to now sort of, you know, you have a fairly level playing ground, she says.

Sarah Holder (3:34)

Like the eu, China sees the Supreme Court's decision as a loss of leverage for the US And a major win for China's trade ambitions ahead of a high stakes meeting between President Trump and President Xi Jinping late next month.

Juan Ha (3:49)

So what was achieved by the trade war?

Jenny Marsh (3:52)

Yeah, what was achieved? I think China realized it's not half as dependent on America as everyone thought.

Sarah Holder (4:04)

This is the big take from Bloomberg News. I'm Sarah Holder. Today on the show, my colleague Wan Ha, who hosts the Big Take Asia podcast, sits down with Brendan Murray in London and Jenny Marsh in Hong Kong to discuss what the end of the U.S. s reciprocal tariffs and the potential for a new global tariff rate means for America's trading partners across Asia and around the world.

Juan Ha (4:30)

Thank you so much, both of you, for making time to join us. Between the three of us, we've got big parts of the world covered. Brendan, you're based in London. Jenny, you're here with me in Hong Kong. Before we get into what this ruling means for countries and manufacturers, I have to ask, what's been the reaction to the Supreme Court ruling on the ground where you are?

Brendan Murray (4:50)

I think a lot of people have more questions right now than they do answers. President Trump came out pretty assertively after the Supreme Court ruled against him and said, in effect, nothing's changed. I still have tariff authorities and I may even use them to a greater degree than I did before. The story is the same. The US Is going to use tariffs to try to reshore manufacturing, create factory jobs, and essentially, as President Trump would say, rebalance the global trading system back in the U.S. s favor.

Juan Ha (5:21)

That's interesting. So he's trying to say nothing's changed here.

Brendan Murray (5:24)

Yeah, nothing's changed. But, you know, in a sense, a lot of things have changed. President Trump, by most accounts, has lost a lot of leverage here.

Juan Ha (5:32)

Jenny, what about here in Hong Kong and broadly in China? What's been the reaction it's been pretty

Jenny Marsh (5:37)

muted, measured, I would say. But also, when you sort of look at this, China sort of came out from the ruling as one of the winners. So, you know, in a way, it's hard for them to sort of come out sort of threatening anything because they've probably benefited from the Supreme Court ruling. I think, you know, particularly ahead of the, the Xi Trump summit as well, they have to be thinking this sort of weakens Trump's hand just a couple of weeks before he flies into Beijing. I think, that being said, China realizes there still is a Section 301 investigation pending against them. So in that sense, they're actually weaker than other countries and that this sort of investigation has already sort of been in train for months. That could be expedited now, so they could quickly see more tariffs. And those tariffs under that investigation have no upper limit and they're pretty sticky. The ones imposed under Section 301 from Trump's first term are still in place. So that probably also is why they're sort of waiting and seeing before coming out with a sort of a strong reaction. And then I think for exporters in this region, particularly sort of ones that had the China plus one strategies for them, I think there's a big question mark now over was it a good idea to invest in new factories in Cambodia and Vietnam? Is it as useful as I thought it was going to be?

Juan Ha (6:51)

Jenny, who are the winners in this and what does this victory mean for them?

Jenny Marsh (6:57)

The biggest winners so far is China, India and Brazil. They were facing the highest tariffs and they're the ones that have seen the biggest sort of percentage point decreases. But I think everyone's aware that this is just the holding pattern, right? This is what Trump has done, is sort of to bridge the gap until he can sort of then use his other tools to get tariffs really where he wants them. And it's going to be much more complicated and harder for business to navigate because rather than looking at sort of broad tariffs, it's going to be this sort of like jumble of different sort of sectorial tariffs. So Japan, South Korea and Taiwan, the big thing they are looking at still now is a Section 232 investigation into chips. And for Taiwan, actually, that was always the case because the trade deal they struck had a carve out for chips, which is sort of the biggest thing they export to the US So in some respects, it was always going to be around these specific investigations into sort of really contentious sectors. And I think that hasn't really changed. So even though it's sort of a headline win in some of these ways for some of these countries, there are sort of more potent measures down the pipeline.

Juan Ha (8:01)

And Brendan, if we talk about winners, someone's losing. Which countries would you place on that list and why?

Brendan Murray (8:08)

The United Kingdom for months has said we negotiated the best deal of a 10% rate with President Trump last year. Now this across the board, 15%. Does that mean they're one of the losers in this? Are they going to get a special carve out? However, the implementation from the White House goes ahead. We haven't talked yet about Canada and Mexico. They've been carved out of the 15% because they're USMCA partners with the U.S. so in that case, they're not really dealt a setback, but they are in the process of renegotiating that North American Free Trade Agreement. And Trump, with all of his displeasure with the Supreme Court, may find Canada and Mexico as outlets to vent his frustration at because he has really gone after Canada recently, Mexico to a lesser degree. But if those negotiations were expected to go smoothly before now, the president without but his favorite tariff tool has got to take another approach. And those two economies could be in for a rough ride over the coming months.

Juan Ha (9:21)

And it seems like countries like Japan and South Korea that had negotiated a 15% tariff rate, it looks like they've now just also lost their competitive advantage as well.

Christina Raffini (9:30)

Right?

Juan Ha (9:31)

If everyone else gets 15%, yeah, absolutely.

Jenny Marsh (9:34)

And I think if you're these trade negotiators and you spent like the last year painstakingly having these meetings and sort of working out these deals, convincing your company to get behind you, it must be so frustrating to wake up and to sort of realize that hard work has sort of been for nothing. At the same time, it makes it harder for Japan, South Korea to sort of say that their trade deals are invalid because the tariffs are actually where they negotiated them to be at. So in a way it's kind of status quo for them.

Sarah Holder (10:06)

After the break, how the last year of tariff drama has shifted the global trade balance and what consequences the latest twist could have for the Xi Trump meeting next month.

Jenny Marsh (10:26)

Will kiss Dahmer last the year. Who's the real opposition on the British right? And how does the UK Government deal with Donald Trump? I'm Lucy Fisher, host of the weekly podcast Political Fix, the show that takes you inside the corridors of power. Join me and my regular panel of expert FT colleagues every Friday for insights and analysis into the latest political happenings in Westminster. Political Fix from the Financial Times. Listen wherever you get Your podcasts.

Sarah Holder (10:58)

We're back with more from Big Tech Asia host Juan Ha, in conversation with Brendan Murray, who runs Bloomberg's trade coverage, and Jenny Marsh, who covers the economy of northern Asia from Hong Kong.

Juan Ha (11:09)

Certainly the US as it stands is still at this point the biggest destination for global manufacturers. To what degree do you think the trade war changed that?

Brendan Murray (11:20)

We just got the US's year end trade balance figures, and if you look at the top 10 U.S. trading partners, they really didn't shift around all that much. China's share of trade fell quite a bit. It's been falling for a couple of years now as the tariff, you know, take effect. But it's still Canada and Mexico at the top. You know, a couple of European countries, South Korea, Japan are in the top 10. Nothing has really changed to a significant degree in a sort of like structural way. This is much more of a slow burn change in the global trading system than a sudden shock to the system. But we're heading into a new chapter now.

Juan Ha (12:05)

And I guess in some ways, I mean, the trade war has also caused this fundamental shift as well. Right? I mean, in terms of certainly companies feeling that they can't rely just on the US as the main dominant market. They've got to find other customers in other parts of the world. Jenny, how has a country like China taken advantage of this asymmetry in global trade?

Jenny Marsh (12:27)

I think China's one of the best, most stark examples of just trade rerouting. You know, by the end of last year, China's exports to the US accounted just for 10% of its total exports. And that's half from the first trade war. You know, and you saw this surge in exports instead to Europe, Latin America, Africa. Exporters just found other markets. And then, you know, China finished the year with that $1.2 trillion trade surplus which no one was expecting it would be able to record in a year where it's facing the highest US tariffs, you know, in nearly a century. So they prove that you can diversify and find other markets. It has also then, you know, it's taken advantage of not only the trade war, but I think just the general volatility of Trump, right, to sort of warm its relationships and warm its trade ties with other countries. You know, you saw Mark Carney come at the beginning of this year and talk about a new world order in China striking a bunch of trade deals with Beijing. And then Beijing kind of, you know, handing out an olive branch by rolling back tariffs that it had imposed on Canada. And then Canada saying, okay, right, you Know, we're going to let in a certain quota of Chinese electric vehicles into Canada, which was something they had resisted to align with the US that seemed like a landmark moment. And then you had Keir Starmer coming just very shortly afterwards and trying to achieve something similar. So I think China sees that other countries now need to diversify, and it's repositioning itself as sort of a land of opportunity at a time when people really are desperate for new growth drivers. And they're now willing to sort of overlook some of the different issues or the difficult issues that has sort of stopped them being so favorable to trade with Beijing, such as the war in Ukraine, human rights issues. People are now kind of. They're being more pragmatic because it's a more kind of dangerous world in terms of trade. Going into the trade war, economists were saying tariffs at 60% are going to decimate the Chinese economy. No way. They're going to sort of come out of this unscathed. Quite stark economic predictions, none of that came to pass. Exports surged, and they hit their growth target of about 5%. So it didn't really have a negative impact on China at all in some ways.

Juan Ha (14:42)

I mean, that's a feather in China's cap, right?

Jenny Marsh (14:43)

Absolutely. Yeah. I think the trade war went better for Xi Jinping than he probably ever realized it would do. And it probably has rewired trade. Like, if those tariffs went away now, would companies start selling back into American markets? Maybe they would, and they'd have even more trade. It's hard to predict.

Juan Ha (15:00)

And, Brendan, what's your take on how global trade is doing now that we're nearly a year since Liberation Day?

Brendan Murray (15:06)

Yeah, I mean, if you look at it on a sort of annual basis, global trade has held up pretty well. But if you go back and look at how it transpired over 2025, it was the front loading. It was strong in the first half of the. And then it kind of softened toward the end of the year. I think we could be in for something similar. A lot of companies will be looking at this 15% rate and say this might be as good as it gets for the next 150 days. So let's place our orders now. So we could see after Chinese New Year, a rush to get items in from markets in Asia into the US but that's just going to complicate the ability of governments and central banks and economists and markets to figure out what is the clear read on the global economy. Is it being sort of propped up right now by some panic purchasing and ordering and inventory stocking, or is there some genuine demand there?

Juan Ha (16:10)

Ginny? Trade obviously goes hand in hand with geopolitical ties. How might the trade shifts affect political ties between the US and its biggest trading partners?

Jenny Marsh (16:20)

I think it's already having an impact, right, because it's this volatility. So US Allies are realizing that the US Is not as a reliable partner, not just in terms of sort of military spending, but in terms of trade as well. You know, you embrace Trump's trade war, you say, okay, we'll make the deals, we'll do the investment, we'll put in the hours, and then turns out they aren't legal after all. And then you have to sort of renegotiate and go back all over again. So I think it just dents US Credibility. No one's going to turn their back on the US it's too powerful. And it still is a huge military guarantor, particularly to countries like Japan in this region. But at the same time, there is a clear need to make sure you have a range of partners and all of your eggs and not just in one basket.

Juan Ha (17:04)

Now, President Trump is expected to meet President Xi at a summit in Beijing at the end of March. How does the Supreme Court ruling change the balance of power at the negotiating table when they meet?

Jenny Marsh (17:15)

This could be the sort of the first test, if you like, a real test of how the Supreme Court sort of changes some of these deals. It will be interesting to see sort of how strongly the Chinese play their hand. On the other hand, I don't think they want to rock the boat too much. You know, the US China relationship has kind of calibrated nicely. And even this year, you've seen Trump, you know, take on so many partners with his claims around Greenland. You know, so much turmoil at European partners amid all of that, it has stayed quite calm with the Chinese. And I think both sides are very committed to sort of keeping that stability going. So maybe they just decide the status quo is a good thing. You know, it's better to have a bird in the hand than two in the tree, and they keep sort of targeting that. But certainly she has more options now than he did a few weeks ago.

Juan Ha (18:07)

What would be the dream scenario for President Xi?

Jenny Marsh (18:10)

Xi Jinping has two things he really cares about getting from the US it is access to the highest end Nvidia chips, and it is some kind of concession on Taiwan. And I think if you're sat in Beijing thinking, what's the biggest thing I can get here? Is this my best moment? Then you're going to push. And Trump has already signaled that he actually is. He's much more open to giving them those top chips than any other US Leader or politician is. And then on Taiwan, they want stronger language around opposing Taiwan independence, which would be a big blow for Taiwan if that language changes. And they want Trump to stop selling Taiwan so many weapons so he could

Juan Ha (18:50)

actually get what he wants.

Jenny Marsh (18:51)

He could, yeah.

Brendan Murray (18:52)

Good.

Sarah Holder (18:58)

This is the big take from Bloomberg News. I'm Sarah Holder. The show is hosted by me, David Gura and Juan Ha. There's Much more on Bloomberg.com get unlimited access to all of our coverage at a special rate for listeners@Bloomberg.com podcastoffer thanks for listening. We'll be back tomorrow.

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Juan Ha (19:46)

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