Trump’s Tariff Gambit: Which Countries Are Negotiating, and What’s the Outcome?

By Boncopia team| Published May 20, 2025 | Boncopia.com | News & Politics, Tariffs & Trade

In April 2025, the United States, under President Donald Trump, unleashed a bold trade strategy, imposing sweeping “reciprocal” tariffs on nearly every trading partner, with rates as high as 50%. The move sent shockwaves through global markets, sparking fears of trade wars, economic instability, and a potential recession. Yet, within days, Trump paused these aggressive tariffs for 90 days, reducing rates to a baseline 10% for most countries (except China, which faces a hefty 125% tariff). This pause, set to expire in early July 2025, was designed to spur negotiations for bespoke trade deals. But which countries are actively negotiating, and what outcomes have emerged? Let’s dive into the current state of play, the motivations driving these talks, and the broader implications for global trade.

The Tariff Landscape: A High-Stakes Poker Game

The U.S. tariffs, announced on April 2, 2025, were rooted in Trump’s “America First Trade Policy,” which aims to address persistent U.S. trade deficits and perceived unfair trade practices. The policy targets countries with high tariffs, non-tariff barriers, or economic policies that suppress domestic consumption, arguing these contribute to an “unusual and extraordinary threat” to U.S. national security and economy. The initial tariffs varied by country, with some facing rates as high as 50%, calculated based on trade deficits and import values.

However, the tariffs’ immediate implementation triggered market turmoil, with the S&P 500 dropping sharply and global supply chains reeling. In response, Trump announced a 90-day pause on April 9, lowering tariffs to 10% for most nations, excluding China, which saw its rate escalate to 125% due to retaliatory measures. This pause was framed as an opportunity for countries to negotiate tailored trade deals, with Treasury Secretary Scott Bessent emphasizing that each negotiation would be “bespoke.”

The White House claims over 75 countries have reached out to negotiate, but the U.S. lacks the capacity to engage with all simultaneously. This limitation, coupled with uncertainty about whether tariffs will snap back post-pause, has created a complex dynamic. Some countries are rushing to the table, while others may be holding back, either due to perceived insignificance of the tariffs or strategic caution.

Who’s Negotiating? A Country-by-Country Breakdown

While the White House has been tight-lipped about the full list of negotiating countries, several nations have publicly confirmed their engagement. Here’s a snapshot of the key players and outcomes to date:

1. China: A Temporary Truce

• Status: After a tit-for-tat escalation, with U.S. tariffs on Chinese goods reaching 145% and China retaliating with 125% duties, both sides agreed to a 90-day tariff truce on May 11, 2025.

• Outcome: The U.S. reduced its tariff on Chinese imports to 30% (from 145%), while China lowered its duties on U.S. goods to 10% (from 125%). The agreement, forged in Geneva, includes a commitment to continue talks, but no major concessions beyond tariff reductions have been reported.

• Context: The truce reflects the unsustainable costs of an all-out trade war, with U.S. businesses facing potential bankruptcies and Chinese exporters struggling. However, Trump has set a hard deadline for a broader deal by August 2025, leaving the future uncertain.

2. United Kingdom: A Historic Deal

• Status: The U.K. secured the first major trade deal under Trump’s tariff policy on May 8, 2025.

• Outcome: The agreement includes zero tariffs on U.K. steel and aluminum exports to the U.S. and a reduced 10% tariff on the first 100,000 U.K. auto imports (down from 25%). The deal also covers non-tariff issues, though specifics remain sparse. The U.K. faced only the 10% baseline tariff, not the higher reciprocal rates, which likely eased negotiations.

• Context: The U.K.’s proactive approach, including offering to review digital taxes and online safety rules, positioned it as a model for other nations.

3. Japan: High Priority, Slow Progress

• Status: Japanese officials have been in talks since early April, with Treasury Secretary Bessent noting Japan’s “priority” status due to its quick response.

• Outcome: No deal has been finalized. Japan faces a 24% tariff, which was reduced to 10% during the pause. Discussions have focused on steel, automobiles, and potential investments in U.S. liquefied natural gas and defense.

• Context: Japan’s non-tariff barriers, such as regulatory hurdles, are a sticking point. Prime Minister Shigeru Ishiba has resisted offering major concessions, aiming for a deal that lifts tariffs entirely.

4. South Korea: Framework in Place

• Status: South Korea’s trade envoy met with U.S. officials in April, and Trump described a “great call” with Acting President Han Duck-soo, signaling progress.

• Outcome: A “framework for item-by-item negotiations” has been established, particularly for steel and automobiles, but no final agreement has been reached. The 25% tariff on South Korean goods was reduced to 10% during the pause.

• Context: South Korea’s strategic importance in countering China makes it a key U.S. partner, but negotiations have slowed recently.

5. India: Talks Moving Quickly

• Status: India is actively negotiating, with Vice President JD Vance visiting in April to kick off talks.

• Outcome: No deal has been finalized, but India’s reluctance to retaliate against U.S. tariffs suggests a willingness to compromise.

• Context: India’s large trade deficit with the U.S. and its strategic role in Asia make it a priority, but complex non-tariff barriers may prolong negotiations.

6. Vietnam: Persistent Efforts

• Status: Vietnam’s initial offer was dismissed by U.S. trade adviser Peter Navarro, but a top official has since traveled to Washington for talks.

• Outcome: No agreement yet. Vietnam offered to drop all tariffs on U.S. goods, but the U.S. has not reciprocated.

• Context: Vietnam’s reliance on U.S. consumers and its 46% tariff rate post-pause make negotiations urgent, but its recent alignment with China complicates matters.

7. European Union: Scoping Stage

• Status: The EU is in the “scoping” stage, seeking clarity on U.S. demands.

• Outcome: No deal has been reached. The EU faces a 10% baseline tariff, with 25% duties on automobiles, steel, and aluminum. The EU is exploring countermeasures but prefers negotiations.

• Context: The EU’s 27 member states complicate talks, and Trump’s long list of grievances, including digital taxes, adds friction.

8. Brazil: Mixed Signals

• Status: Brazil faced a 10% baseline tariff and 25% duties on steel and aluminum. It has not confirmed active negotiations.

• Outcome: No deal. Brazil initially threatened retaliation but later opted against it, with coffee exporters seeing opportunities in the tariff structure.

• Context: Brazil’s trade surplus with the U.S. in 2024 makes it less urgent to negotiate, but companies like Embraer face rising costs.

9. Fiji: Early Talks

• Status: Fiji confirmed on May 11, 2025, that it would engage in tariff talks, aiming for a “win-win” outcome.

• Outcome: No agreement yet. Details on Fiji’s tariff rates are unclear, but its small trade volume suggests limited U.S. focus.

• Context: Fiji’s export-dependent economy makes it eager to negotiate, but its low priority may delay progress.

10. Others: Waiting in the Wings

• Countries like Israel, Taiwan, Indonesia, Australia, and the Philippines have expressed interest in negotiations, with some (e.g., Israel and Taiwan) offering to zero out tariffs on U.S. goods. However, the U.S. has not granted concessions, and many nations report a lack of engagement from the White House.

Why Some Countries Aren’t Rushing to Negotiate

Despite the White House’s claim of widespread interest, not all countries are actively engaging. Several factors explain this:

1. Uncertainty and Volatility: The rapid shifts in U.S. policy—imposing tariffs, pausing them, and escalating against China—have left countries unsure of Trump’s endgame. Diplomats report confusion, with some noting the White House hasn’t responded to their outreach. This uncertainty may deter nations from investing in complex negotiations.

2. Limited U.S. Capacity: Treasury Secretary Bessent admitted the U.S. can’t negotiate with all 75+ interested countries at once, prioritizing the “big 15” economies (e.g., Japan, Germany, India). Smaller nations like Fiji or the Philippines may be sidelined, reducing their incentive to push forward.

3. Perceived Insignificance: Countries with minimal U.S. trade or those less affected by the 10% baseline tariff may not see negotiations as urgent. For instance, Brazil’s coffee exporters view tariffs as an opportunity to outcompete rivals.

4. Strategic Caution: Some nations, like the EU, are taking a wait-and-see approach, scoping out U.S. demands before committing. Others, like Vietnam, may be hedging bets by aligning with China.

Outcomes and Implications

So far, only the U.K. and China have secured concrete outcomes, with the U.K.’s deal setting a precedent for targeted tariff reductions and China’s truce averting a full-blown trade war. However, the broader picture remains murky:

• Economic Impact: The Budget Lab at Yale estimates that current tariffs, if maintained, will raise U.S. consumer prices by 1.7% in the short term, reduce GDP growth by 0.7%, and cut payroll employment by 456,000 jobs by year-end. Clothing and textiles face the steepest price hikes, with shoes and apparel up 15% and 14%, respectively.

• Global Trade Dynamics: The tariffs have disrupted supply chains, with companies like Nike (sourcing from Vietnam) and YouTube star MrBeast’s chocolate brand (produced in Peru) facing higher costs. The EU and China are exploring coalitions with countries like India and Indonesia to stabilize the World Trade Organization’s rules-based system.

• Market Volatility: The stock market’s rollercoaster ride—plummeting after the tariff announcement and surging 7% on the pause—underscores the stakes. A prolonged trade war could trigger a 2025 stock market crash, as warned by analysts.

What’s Next?

With the 90-day pause nearing its halfway mark, the pressure is on. Trump’s team, led by Bessent and trade adviser Peter Navarro, is pushing for rapid deals, but the administration’s unilateral approach—planning to set tariff rates for some countries without negotiations by July—signals impatience. The U.K. deal and China truce offer hope, but the lack of clarity on U.S. demands and the sheer volume of interested countries pose challenges.

Countries like Japan, South Korea, and India are likely to remain priorities due to their economic and strategic weight, while smaller nations may face prolonged uncertainty. The EU’s slow progress and China’s temporary reprieve highlight the complexity of balancing bilateral deals with global trade stability.

Thought Questions

1. Will Trump’s tariff strategy force meaningful concessions from trading partners, or will it backfire by escalating global trade tensions?

2. How should smaller nations like Fiji or the Philippines approach negotiations when the U.S. prioritizes larger economies?

3. Can the U.S. sustain its aggressive tariff policy without triggering a domestic economic downturn, given the projected GDP and job losses?