Trump turns tables on G7 summit with free trade ‘proclamation’

U.S. President Donald Trump waves as he arrives to board Air Force One to depart for travel to Singapore from the Canadian Forces Base Bagotville, Quebec, Canada. (Reuters pic)

WASHINGTON: President Donald Trump shook up a meeting of the leaders of the world’s richest countries with a proposal to eliminate all barriers to global trade, a surprise turnaround from his aggressive tone on tariffs before the summit.

Trump headed into the Group of Seven talks in Canada having picked fights with some of his biggest allies, who vowed to confront him about new US tariffs on steel and aluminium. Once on the ground in Quebec, though, he turned the tables on leaders who accuse the US of protectionism.

“No tariffs, no barriers, that’s the way it should be, and no subsidies,” Trump said on Saturday during a 30-minute press conference in La Malbaie. “I did suggest it and people were — I guess they’re going to go back to the drawing board and check it out.”

The trade spat dominated the meeting, with Canadian and European leaders threatening retaliatory duties in response to the US levies. Canadian Prime Minister Justin Trudeau and French President Emmanuel Macron were especially vocal ahead of Trump’s arrival.

Behind the scenes the discussions, which went late into the night and through Saturday morning, were tense and pointed. The European leaders sought to show unity against Trump and prod him into concessions on the tariffs, or at least an agreement to talk more about them.

But Trump’s gambit, which his economic adviser Larry Kudlow told reporters amounted to a “free trade proclamation,” called the other leaders’ bluff — if they’re so opposed to his new tariffs, he suggested, why not eliminate all tariffs?

Trump knew, of course, that other G7 members don’t want to eliminate all tariffs, just the new US ones they see as potentially damaging to their economies. He has long argued for reciprocal trade, meaning that US tariff rates should be equal to other major trading partners’ duties.

“We’re like the piggy bank that everybody is robbing, and that ends,” said Trump.

German Chancellor Angela Merkel said she agreed with Trump’s push for a freer trade, adding talks over crucial changes to global trading rules will keep moving ahead.

“We also agreed that we want to reduce tariffs and remove trade barriers and also to reduce subsidies,” Merkel said at her closing press conference. “Many of the current discussions about trade, especially with the US, despite the common commitment, will continue.”

Trade Truce

Merkel is proposing a forum — a “shared evaluation mechanism” — aimed at defusing the tensions with the US The idea has the backing of other European members, though it’s unclear if it will get support from the Trump administration.

A German government official said the plan would see direct talks between the EU and the US start straight away, and last around two weeks, focused on how much, or whether, EU trade policy endangers US national security interests. It would include outside experts.

Merkel said she expects that all G7 nations will sign a final joint statement, although disagreements remain over the wording on trade, Iran and Russia. The US isn’t expected to join separate agreements for cleaner oceans or combating climate change, which the other six nations will sign, Merkel said.