1 00:00:02,720 --> 00:00:07,200 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:08,920 --> 00:00:13,160 Speaker 2: Across Asia, policymakers and business leaders are once again trying 3 00:00:13,200 --> 00:00:17,200 Speaker 2: to make sense of a tariff whiplash, this time after 4 00:00:17,239 --> 00:00:22,040 Speaker 2: the Supreme Court ruled President Donald Trump's signature tariff strategy illegal. 5 00:00:22,280 --> 00:00:25,560 Speaker 3: A top official in Japan's ruling Liberal Democratic Party call 6 00:00:25,680 --> 00:00:29,760 Speaker 3: the tariff situation a real mess, while sources say Indian 7 00:00:29,800 --> 00:00:33,479 Speaker 3: officials are postponing talks to finalize New Dali's pact with 8 00:00:33,560 --> 00:00:34,040 Speaker 3: the US. 9 00:00:34,920 --> 00:00:38,400 Speaker 2: Much of the confusion comes from Trump's workaround response to 10 00:00:38,479 --> 00:00:42,200 Speaker 2: the Supreme Court ruling and his threats to impose fresh 11 00:00:42,240 --> 00:00:46,720 Speaker 2: tariffs on trading partners. He announced a temporary ten percent 12 00:00:46,760 --> 00:00:49,720 Speaker 2: global tariff that went into effect Tuesday, and said he 13 00:00:49,800 --> 00:00:54,320 Speaker 2: plans to raise it to fifteen percent. Trump's also getting 14 00:00:54,360 --> 00:00:57,720 Speaker 2: ready to launch a series of investigations that could pile 15 00:00:57,800 --> 00:01:02,280 Speaker 2: on even more import duties. Some are tied to national security, 16 00:01:02,680 --> 00:01:05,240 Speaker 2: others are connected to Section three oh one of a 17 00:01:05,280 --> 00:01:09,160 Speaker 2: trade act. They could allow the US to impose retaliatory 18 00:01:09,280 --> 00:01:14,440 Speaker 2: levies on countries carrying out unreasonable or discriminatory actions against 19 00:01:14,520 --> 00:01:15,520 Speaker 2: American trade. 20 00:01:15,760 --> 00:01:19,560 Speaker 4: The President is sending out a series of warnings today 21 00:01:19,720 --> 00:01:24,000 Speaker 4: via truth Social about any country that doubts his ability 22 00:01:24,120 --> 00:01:28,000 Speaker 4: to impose tariffs in this fashion, He said, any country 23 00:01:28,040 --> 00:01:31,440 Speaker 4: that wants to play games with the ridiculous Supreme Court 24 00:01:31,480 --> 00:01:33,840 Speaker 4: decision buyer beware. 25 00:01:35,400 --> 00:01:39,160 Speaker 2: After Trump announced his Liberation Day tariffs almost a year ago, 26 00:01:39,520 --> 00:01:43,080 Speaker 2: countries in Asia race to negotiate trade deals with the US. 27 00:01:43,680 --> 00:01:46,200 Speaker 2: Now they're wondering if they're going to have to renegotiate, 28 00:01:46,640 --> 00:01:49,440 Speaker 2: and this time around, many are finding they're in a 29 00:01:49,520 --> 00:01:50,600 Speaker 2: much better position. 30 00:01:51,040 --> 00:01:54,080 Speaker 5: President Trump, by most accounts, has lost a lot of 31 00:01:54,160 --> 00:01:54,800 Speaker 5: leverage here. 32 00:01:55,120 --> 00:01:59,160 Speaker 2: Brendan Murray oversees Bloomberg's trade coverage from London, and. 33 00:01:59,040 --> 00:02:03,240 Speaker 5: If you're sitting in Brussels or Beijing right now, you're saying, 34 00:02:03,720 --> 00:02:07,400 Speaker 5: perhaps maybe we have more leverage than we did last week, 35 00:02:07,680 --> 00:02:11,000 Speaker 5: so maybe we could think about retaliating. Maybe this is 36 00:02:11,040 --> 00:02:14,800 Speaker 5: where the countries look at what President Trump has lost 37 00:02:15,080 --> 00:02:16,919 Speaker 5: and they say, you know, we're not going to put 38 00:02:17,000 --> 00:02:19,280 Speaker 5: up with that, and we do have ways to fight back. 39 00:02:19,600 --> 00:02:22,160 Speaker 2: One of the countries that stands to win big out 40 00:02:22,200 --> 00:02:23,840 Speaker 2: of all of this China. 41 00:02:24,280 --> 00:02:26,080 Speaker 1: If you're Beijing, you're sort of now on a level 42 00:02:26,080 --> 00:02:28,079 Speaker 1: playing field with US allies. 43 00:02:28,440 --> 00:02:32,959 Speaker 2: Jenny marsh oversees Bloomberg's coverage of North Asia's economy and politics. 44 00:02:33,280 --> 00:02:35,639 Speaker 1: You've gone from the biggest target when Trump first came 45 00:02:35,680 --> 00:02:38,200 Speaker 1: into now sort of you know, you have a fairly 46 00:02:38,400 --> 00:02:39,679 Speaker 1: level playing ground. 47 00:02:39,760 --> 00:02:40,200 Speaker 3: She says. 48 00:02:40,240 --> 00:02:43,920 Speaker 2: The Supreme Court's decision shifts the power dynamics ahead of 49 00:02:43,960 --> 00:02:47,600 Speaker 2: an important summit between President Trump and President hijin Ping 50 00:02:47,919 --> 00:02:54,079 Speaker 2: next month. So what was achieved by the trade war? 51 00:02:54,400 --> 00:02:55,440 Speaker 3: Yeah? 52 00:02:55,480 --> 00:02:58,440 Speaker 1: What was achieved? I think China realized is not half 53 00:02:58,440 --> 00:03:01,000 Speaker 1: as dependent on America as everyone thought. 54 00:03:05,960 --> 00:03:09,320 Speaker 2: This is the big Take Asia from Bloomberg News. I'm Wanha. 55 00:03:09,919 --> 00:03:12,239 Speaker 2: Every week we take you inside some of the world's 56 00:03:12,240 --> 00:03:16,120 Speaker 2: biggest and most powerful economies and the markets, tycoons and 57 00:03:16,200 --> 00:03:20,440 Speaker 2: businesses that drive this ever shifting region. Today on the show, 58 00:03:20,680 --> 00:03:24,280 Speaker 2: a legal blow in Washington, d C. Just added more 59 00:03:24,360 --> 00:03:28,600 Speaker 2: trade uncertainty, how the Supreme Court tariff ruling is playing 60 00:03:28,600 --> 00:03:32,720 Speaker 2: out in Asia, and the surprise advantage it could give 61 00:03:32,919 --> 00:03:40,640 Speaker 2: to Beijing. Thank you so much, both of you for 62 00:03:40,680 --> 00:03:43,560 Speaker 2: making time to join us. Between the three of us, 63 00:03:43,600 --> 00:03:46,480 Speaker 2: we've got big parts of the world covered. Brendon, you're 64 00:03:46,520 --> 00:03:49,280 Speaker 2: based in London. Jenny, you're here with me in Hong Kong. 65 00:03:49,680 --> 00:03:52,640 Speaker 2: Before we get into what this ruling means, for countries 66 00:03:52,680 --> 00:03:56,240 Speaker 2: and manufacturers. I have to ask, what's been the reaction 67 00:03:56,400 --> 00:03:59,040 Speaker 2: to the Supreme Court ruling on the ground where you 68 00:03:59,120 --> 00:04:00,280 Speaker 2: are a lot. 69 00:04:00,200 --> 00:04:03,480 Speaker 5: Of people have more questions right now than they do answers. 70 00:04:03,800 --> 00:04:08,120 Speaker 5: President Trump came out pretty assertively after the Supreme Court 71 00:04:08,280 --> 00:04:12,440 Speaker 5: ruled against him and said, in effect, nothing's changed. I 72 00:04:12,480 --> 00:04:15,200 Speaker 5: still have teriff authorities, and I may even use them 73 00:04:15,400 --> 00:04:17,880 Speaker 5: to a greater degree than I did before. The story 74 00:04:17,960 --> 00:04:20,240 Speaker 5: is the same. The US is going to use tariffs 75 00:04:20,480 --> 00:04:25,520 Speaker 5: to try to reshore manufacturing, create factory jobs, and essentially, 76 00:04:25,640 --> 00:04:29,160 Speaker 5: as President Trump would say, rebalance the global trading system 77 00:04:29,200 --> 00:04:30,320 Speaker 5: back in the US's favor. 78 00:04:30,520 --> 00:04:32,839 Speaker 2: That's interesting. So he's trying to say nothing's changed here. 79 00:04:33,080 --> 00:04:35,640 Speaker 5: Yeah, nothing's changed, but you know, in a sense, a 80 00:04:35,680 --> 00:04:38,760 Speaker 5: lot of things have changed. President Trump, by most accounts, 81 00:04:39,000 --> 00:04:40,560 Speaker 5: has lost a lot of leverage here. 82 00:04:40,800 --> 00:04:43,880 Speaker 2: Jenny, what about here in Hong Kong and broadly in China. 83 00:04:43,960 --> 00:04:45,240 Speaker 2: What's been the reaction. 84 00:04:45,200 --> 00:04:48,320 Speaker 1: It's been pretty mute in measured, I would say, But 85 00:04:48,440 --> 00:04:50,719 Speaker 1: also when you sort of look at this, China sort 86 00:04:50,720 --> 00:04:53,440 Speaker 1: of came out from the ruling as one of the winners, 87 00:04:53,800 --> 00:04:55,440 Speaker 1: so you know, in a way, it's half of them 88 00:04:55,520 --> 00:04:58,039 Speaker 1: to sort of come out sort of threatening anything because 89 00:04:58,080 --> 00:05:02,360 Speaker 1: they've probably benefited from the Supreme Court ruling. I think, 90 00:05:02,440 --> 00:05:05,520 Speaker 1: you know, particularly ahead of the she Trump's summit as well, 91 00:05:06,279 --> 00:05:09,159 Speaker 1: they have to be thinking this sort of weakens Trump's 92 00:05:09,160 --> 00:05:12,120 Speaker 1: hand just a couple of weeks before he fires into Beijing. 93 00:05:12,520 --> 00:05:15,640 Speaker 1: I think that being said, China realizes this still is 94 00:05:15,880 --> 00:05:19,280 Speaker 1: a Section three zero one investigation pending against them, so 95 00:05:19,320 --> 00:05:21,600 Speaker 1: in that sense, they're actually weaker than other countries, and 96 00:05:21,680 --> 00:05:25,200 Speaker 1: that this sort of investigation has already sort of been 97 00:05:25,200 --> 00:05:28,520 Speaker 1: in trained for months that could be expedited now so 98 00:05:28,560 --> 00:05:31,360 Speaker 1: they could quickly see more tariffs, and those tariffs under 99 00:05:31,400 --> 00:05:34,600 Speaker 1: that investigation have no upper limit and they're pretty sticky. 100 00:05:34,760 --> 00:05:37,320 Speaker 1: The ones imposed under Section three zero one from Trump's 101 00:05:37,320 --> 00:05:39,200 Speaker 1: first term is still in place, so I think that 102 00:05:39,200 --> 00:05:42,080 Speaker 1: probably also is why they're sort of waiting and seeing 103 00:05:42,080 --> 00:05:44,160 Speaker 1: before coming out with a sort of a strong reaction. 104 00:05:44,400 --> 00:05:47,200 Speaker 1: And then I think for exporters in this region, particularly 105 00:05:47,680 --> 00:05:49,960 Speaker 1: sort of ones that had the China plus one strategies 106 00:05:50,040 --> 00:05:52,040 Speaker 1: for them, I think there's a big question right now 107 00:05:52,080 --> 00:05:54,360 Speaker 1: over was it a good idea to invest in new 108 00:05:54,400 --> 00:05:57,480 Speaker 1: factories in Cambodia and Vietnam. Is it as useful as 109 00:05:57,480 --> 00:05:58,360 Speaker 1: I thought it was going to. 110 00:05:58,320 --> 00:06:03,680 Speaker 2: Be Jenny, Who are the winners in this and what 111 00:06:03,800 --> 00:06:05,320 Speaker 2: does this victory mean for them? 112 00:06:05,839 --> 00:06:10,200 Speaker 1: The biggest winners so far, it's China, India, and Brazil. 113 00:06:10,520 --> 00:06:12,360 Speaker 1: They were facing the highest tariffs and they're the ones 114 00:06:12,360 --> 00:06:15,400 Speaker 1: that have seen the biggest sort of percentage point decreases. 115 00:06:15,880 --> 00:06:17,760 Speaker 1: But I think everyone's aware that this is just the 116 00:06:17,839 --> 00:06:20,520 Speaker 1: holding pattern, right. This is what Trump has done is 117 00:06:20,560 --> 00:06:23,000 Speaker 1: sort of to bridge the gap until he can sort 118 00:06:23,000 --> 00:06:25,720 Speaker 1: of then use his other tools to get tariffs really 119 00:06:25,760 --> 00:06:27,760 Speaker 1: where he wants them. And it's going to be much 120 00:06:27,760 --> 00:06:30,480 Speaker 1: more complicated and harder for business to navigate because rather 121 00:06:30,520 --> 00:06:32,839 Speaker 1: than thinking a sort of broad tariffs, it's going to 122 00:06:32,880 --> 00:06:35,640 Speaker 1: be this sort of like jumble of different sort of 123 00:06:35,640 --> 00:06:39,599 Speaker 1: sectorial tariffs. So Japan, South Korea, and Taiwan, the big 124 00:06:39,600 --> 00:06:42,080 Speaker 1: thing they are looking at still now is a section 125 00:06:42,160 --> 00:06:45,440 Speaker 1: two three two investigation into chips, And for Taiwan, actually 126 00:06:45,440 --> 00:06:47,880 Speaker 1: that was always the case because the trade deal they 127 00:06:47,920 --> 00:06:50,400 Speaker 1: struck had a carve out for chips, which is sort 128 00:06:50,440 --> 00:06:52,320 Speaker 1: of the biggest thing in the export to the US. 129 00:06:52,920 --> 00:06:55,359 Speaker 1: So in some respects it was always going to be 130 00:06:55,400 --> 00:06:59,920 Speaker 1: around these specific investigations into sort of really contentious sect 131 00:07:00,680 --> 00:07:03,440 Speaker 1: and I think that hasn't really changed. So even though 132 00:07:03,480 --> 00:07:05,120 Speaker 1: it's sort of a headline win in some of these ways, 133 00:07:05,120 --> 00:07:07,120 Speaker 1: for some of these countries, there are sort of more 134 00:07:07,200 --> 00:07:09,480 Speaker 1: potent measures down the pipeline. 135 00:07:10,200 --> 00:07:12,600 Speaker 2: And it seems like countries like Japan and South Korea 136 00:07:12,680 --> 00:07:16,440 Speaker 2: that had negotiated a fifteen percent terror freight, it looks 137 00:07:16,440 --> 00:07:19,920 Speaker 2: like they've now just also lost their competitive advantage as well, 138 00:07:20,000 --> 00:07:22,280 Speaker 2: right if everyone else gets fifteen percent? 139 00:07:22,600 --> 00:07:25,600 Speaker 1: Yeah, absolutely. And I think if you're these trade negotiators 140 00:07:25,600 --> 00:07:28,880 Speaker 1: and you've spent like the last year painstaking me having 141 00:07:28,880 --> 00:07:32,120 Speaker 1: these meetings and sort of working out these deals, convincing 142 00:07:32,120 --> 00:07:34,960 Speaker 1: your companies to get behind you, it must be so 143 00:07:35,040 --> 00:07:37,400 Speaker 1: frustrating to wake up and to sort of realize that 144 00:07:37,720 --> 00:07:40,120 Speaker 1: hard work has sort of been for nothing. At the 145 00:07:40,120 --> 00:07:42,760 Speaker 1: same time, it makes it harder for Japan South Korea 146 00:07:42,800 --> 00:07:44,720 Speaker 1: to sort of say that their trade deals are invalid 147 00:07:44,800 --> 00:07:47,560 Speaker 1: because the tariffs are actually where they negotiated them to 148 00:07:47,640 --> 00:07:50,720 Speaker 1: be at, So in a way, it's kind of status 149 00:07:50,760 --> 00:07:53,320 Speaker 1: quo for them. 150 00:07:53,640 --> 00:07:56,320 Speaker 2: After the break, how the tariff drama of the past 151 00:07:56,400 --> 00:07:59,920 Speaker 2: year has remapped global trade and how the Supreme Court 152 00:08:00,040 --> 00:08:03,400 Speaker 2: ruling could play Deshijan thing's advantage at a high stakes 153 00:08:03,440 --> 00:08:20,440 Speaker 2: summit next month. I'm back with Brendan Murray, who runs 154 00:08:20,440 --> 00:08:24,120 Speaker 2: Bloomberg's trade coverage, and Jenny marsh who oversees North Asia's 155 00:08:24,120 --> 00:08:28,560 Speaker 2: economy and politics. Regardless of how President Trump responds to 156 00:08:28,600 --> 00:08:31,480 Speaker 2: the upending of his tariff regime by the Supreme Court, 157 00:08:31,880 --> 00:08:35,520 Speaker 2: the global trading system has already been transformed in ways 158 00:08:35,559 --> 00:08:39,600 Speaker 2: that don't necessarily favor the US, even if America's trade 159 00:08:39,679 --> 00:08:44,680 Speaker 2: numbers and key partners remain relatively the same. Certainly, the 160 00:08:44,840 --> 00:08:48,440 Speaker 2: US as it stands is still at this point the 161 00:08:48,440 --> 00:08:53,040 Speaker 2: biggest destination for global manufacturers. To what degree do you 162 00:08:53,080 --> 00:08:54,920 Speaker 2: think the trade war changed that. 163 00:08:55,240 --> 00:08:59,319 Speaker 5: We just got the US's year end trade balance figures, 164 00:08:59,600 --> 00:09:02,360 Speaker 5: and if you look at the top ten US trading partners, 165 00:09:02,720 --> 00:09:05,920 Speaker 5: they really didn't shift around all that much. China's share 166 00:09:05,960 --> 00:09:08,920 Speaker 5: of trade fell quite a bit, It's been falling for 167 00:09:08,960 --> 00:09:12,800 Speaker 5: a couple of years now as the tariffs do take effect. 168 00:09:13,320 --> 00:09:17,200 Speaker 5: But it's still Canada and Mexico at the top. You know, 169 00:09:17,280 --> 00:09:21,400 Speaker 5: a couple of European countries, South Korea, Japan are in 170 00:09:21,440 --> 00:09:25,760 Speaker 5: the top ten. Nothing has really changed to a significant 171 00:09:26,200 --> 00:09:30,040 Speaker 5: degree in a sort of like structural way. This is 172 00:09:30,160 --> 00:09:34,439 Speaker 5: much more of a slow burn change in the global 173 00:09:34,480 --> 00:09:37,680 Speaker 5: trading system than a sudden shock to the system. But 174 00:09:37,880 --> 00:09:40,520 Speaker 5: we're heading into a new chapter now, and I guess in. 175 00:09:40,480 --> 00:09:42,480 Speaker 2: Some ways, I mean that the trade war has also 176 00:09:42,679 --> 00:09:45,800 Speaker 2: caused this fundamental shift as well, right, I mean in 177 00:09:45,920 --> 00:09:49,320 Speaker 2: terms of certainly companies feeling that they can't rely just 178 00:09:49,360 --> 00:09:51,360 Speaker 2: on the US as the main dominant market. They've got 179 00:09:51,400 --> 00:09:54,840 Speaker 2: to find other customers in other parts of the world. Jenny, 180 00:09:55,040 --> 00:09:58,719 Speaker 2: how has a country like China taken advantage of this 181 00:09:59,280 --> 00:10:01,199 Speaker 2: asymmetry in global trade. 182 00:10:01,240 --> 00:10:03,440 Speaker 1: I think China's one of the best and most stark 183 00:10:03,480 --> 00:10:06,240 Speaker 1: examples of just trade re routing. You know, by the 184 00:10:06,320 --> 00:10:09,760 Speaker 1: end of last year, China's exports to the US just 185 00:10:09,760 --> 00:10:12,240 Speaker 1: for ten percent of its total exports, and that's half 186 00:10:12,320 --> 00:10:15,120 Speaker 1: from the first trade war, you know, and you saw 187 00:10:15,160 --> 00:10:19,119 Speaker 1: the surge and exports instead to Europe, Latin America, Africa. 188 00:10:19,600 --> 00:10:22,560 Speaker 1: Export has just found other markets. And then you know, 189 00:10:22,679 --> 00:10:24,800 Speaker 1: China finished the year with that one point two trillion 190 00:10:24,840 --> 00:10:28,160 Speaker 1: dollar trade surplus, which no one was expecting it would 191 00:10:28,160 --> 00:10:30,079 Speaker 1: be able to record in a year where it's facing 192 00:10:30,559 --> 00:10:33,880 Speaker 1: the highest US tariffs, you know, in nearly a century, 193 00:10:34,400 --> 00:10:38,480 Speaker 1: so they prove that you can diversify and find other markets. 194 00:10:40,000 --> 00:10:42,600 Speaker 1: And it's also then, you know, it's taken an advantage 195 00:10:42,640 --> 00:10:44,720 Speaker 1: of not only the trade war, but I think just 196 00:10:44,760 --> 00:10:47,640 Speaker 1: the general volatility of Trump right just sort of warm 197 00:10:47,640 --> 00:10:50,840 Speaker 1: its relationships and warm its trade ties with other countries. 198 00:10:50,840 --> 00:10:53,240 Speaker 1: You know, you saw Mark Carney come at the beginning 199 00:10:53,280 --> 00:10:55,520 Speaker 1: of this year and talk about a new world order 200 00:10:56,200 --> 00:10:59,440 Speaker 1: in China, striking a bunch of trade deals with Beijing, 201 00:10:59,720 --> 00:11:02,320 Speaker 1: and then Beijing kind of you know, handing out an 202 00:11:02,320 --> 00:11:04,720 Speaker 1: olive branch or rolling back to tariffs that it had 203 00:11:04,720 --> 00:11:07,839 Speaker 1: imposed on Canada, and then Canada are saying, okay, right, 204 00:11:07,920 --> 00:11:09,880 Speaker 1: you know, we're going to let in a certain quoture 205 00:11:09,920 --> 00:11:13,120 Speaker 1: of Chinese electric vehicles into Canada, which was something they 206 00:11:13,200 --> 00:11:17,080 Speaker 1: had resisted to align with the US. That seemed like 207 00:11:17,240 --> 00:11:20,280 Speaker 1: a landmark moment. And then you had kiss Arma coming 208 00:11:20,320 --> 00:11:23,640 Speaker 1: just very shortly afterwards and trying to achieve something similar. 209 00:11:24,080 --> 00:11:28,160 Speaker 1: So I think China sees that other countries now need 210 00:11:28,200 --> 00:11:32,240 Speaker 1: to diversify, and it's repositioning itself as sort of a 211 00:11:32,320 --> 00:11:35,160 Speaker 1: land of opportunity at a time when people really are 212 00:11:35,200 --> 00:11:38,080 Speaker 1: desperate from new growth drivers and there now worring to 213 00:11:38,080 --> 00:11:41,080 Speaker 1: sort of overlook some of the different issues or the 214 00:11:41,080 --> 00:11:44,520 Speaker 1: difficult issues that had sort of stopped them being so 215 00:11:44,760 --> 00:11:47,880 Speaker 1: favorable to trade with Beijing, such as the war in Ukraine, 216 00:11:48,240 --> 00:11:50,640 Speaker 1: human rights issues. People are now kind of they're being 217 00:11:50,640 --> 00:11:52,959 Speaker 1: more pragmatic because it's a more kind of dangerous world 218 00:11:53,000 --> 00:11:55,720 Speaker 1: in terms of trade. Going into the trade war, economists 219 00:11:55,760 --> 00:11:58,840 Speaker 1: was saying tariffs at sixty percent are going to like 220 00:11:59,080 --> 00:12:01,880 Speaker 1: decimate the Chinese economy. No way, They're going to sort 221 00:12:01,880 --> 00:12:05,160 Speaker 1: of come out of this unscathed, quite stark economic predictions. 222 00:12:05,760 --> 00:12:08,880 Speaker 1: None of that came to pass. You know, exports surged 223 00:12:09,280 --> 00:12:11,480 Speaker 1: and they hit their growth target of about five percent, 224 00:12:12,000 --> 00:12:14,840 Speaker 1: so it didn't really have a negative impact on China 225 00:12:14,880 --> 00:12:15,439 Speaker 1: at all. 226 00:12:15,679 --> 00:12:17,400 Speaker 2: In some ways. I mean, that's a feather in China's cap. 227 00:12:17,400 --> 00:12:19,720 Speaker 1: Br Absolutely, yeah. I think the trade war went better 228 00:12:19,720 --> 00:12:22,920 Speaker 1: for shuji Ping than he probably ever realized it would do, 229 00:12:23,559 --> 00:12:26,280 Speaker 1: and it probably has rewired trade. Like if those tarrists 230 00:12:26,280 --> 00:12:29,880 Speaker 1: went away now wood companies start selling back into American markets, 231 00:12:30,600 --> 00:12:33,160 Speaker 1: maybe they would, and they'd have even more trade. You know, 232 00:12:33,240 --> 00:12:36,160 Speaker 1: it's hard to predict, Jenny. 233 00:12:36,320 --> 00:12:39,960 Speaker 2: Trade obviously goes hand in hand with geopolitical ties. How 234 00:12:40,040 --> 00:12:43,400 Speaker 2: might the trade shifts affect political ties between the US 235 00:12:43,440 --> 00:12:45,160 Speaker 2: and its biggest trading partners. 236 00:12:45,800 --> 00:12:49,000 Speaker 1: I think it's already handing an impact right because it's 237 00:12:49,000 --> 00:12:52,640 Speaker 1: this volatility. So US allies are realizing that the US 238 00:12:52,720 --> 00:12:55,200 Speaker 1: is not as a reliable partner, not just in terms 239 00:12:55,200 --> 00:12:57,360 Speaker 1: of sort of military spending, but in terms of trade 240 00:12:57,360 --> 00:13:00,800 Speaker 1: as well. You know, you embraced Trump's trade war. You say, Okay, 241 00:13:01,240 --> 00:13:03,400 Speaker 1: we'll make the deals, we'll do the investment, we'll put 242 00:13:03,400 --> 00:13:07,199 Speaker 1: in the hours, and then turns out they aren't legal 243 00:13:07,240 --> 00:13:10,120 Speaker 1: after all, and then you have to sort of renegotiate 244 00:13:10,120 --> 00:13:12,600 Speaker 1: and go back all over again. So I think it 245 00:13:12,720 --> 00:13:15,760 Speaker 1: just dnse US credibility. No one's going to turn their 246 00:13:15,800 --> 00:13:18,280 Speaker 1: back on the US. It's too powerful, and it still 247 00:13:18,360 --> 00:13:22,360 Speaker 1: is a huge military guaranteeur particularly countriesie Japan in this region. 248 00:13:22,840 --> 00:13:25,199 Speaker 1: But at the same time, there is a clear need 249 00:13:25,240 --> 00:13:27,640 Speaker 1: to make sure you have a range of partners in 250 00:13:27,679 --> 00:13:29,480 Speaker 1: all of your eggs and not just in one basket. 251 00:13:29,880 --> 00:13:32,719 Speaker 2: Now President Trump is expected to meet President she at 252 00:13:32,720 --> 00:13:35,360 Speaker 2: a summit embing at the end of March. How does 253 00:13:35,400 --> 00:13:38,920 Speaker 2: the Supreme Court ruling change the balance of power at 254 00:13:38,960 --> 00:13:41,040 Speaker 2: the negotiating table when they meet. 255 00:13:41,480 --> 00:13:43,880 Speaker 1: This could be the sort of the first test, if 256 00:13:43,920 --> 00:13:46,960 Speaker 1: you like, real test of how the Supreme Court sort 257 00:13:47,000 --> 00:13:50,040 Speaker 1: of changes some of these deals. It's hard to imagine 258 00:13:50,080 --> 00:13:53,000 Speaker 1: Trump arriving with any less sort of swagger than he 259 00:13:53,040 --> 00:13:55,280 Speaker 1: would do normally. And he knows that he has these 260 00:13:55,320 --> 00:13:58,120 Speaker 1: sort of Section three zero one investigations that he could 261 00:13:58,120 --> 00:14:01,200 Speaker 1: still threaten more tariffs, and with China, he's already got 262 00:14:01,240 --> 00:14:04,199 Speaker 1: an investigation going where he could impose them at the 263 00:14:04,240 --> 00:14:06,720 Speaker 1: same time. One of the big deliverables they were meant 264 00:14:06,720 --> 00:14:10,160 Speaker 1: to extend the trade truths they have and that's predicated. 265 00:14:10,240 --> 00:14:13,680 Speaker 1: And you know, China keeps supplying where earth if America 266 00:14:13,760 --> 00:14:17,400 Speaker 1: doesn't raise tariffs, if it keeps the tariffs down, or 267 00:14:17,400 --> 00:14:20,880 Speaker 1: the tariffs are gone. So if you're China, you know, 268 00:14:21,680 --> 00:14:24,080 Speaker 1: maybe you ask something extra now to keep up your 269 00:14:24,080 --> 00:14:26,480 Speaker 1: half of the deal. The only reason they were buying 270 00:14:26,520 --> 00:14:29,640 Speaker 1: the soybeans from the US was again to get the 271 00:14:29,680 --> 00:14:33,320 Speaker 1: tariffs down. Well, if the tariff's not there anymore, it 272 00:14:33,360 --> 00:14:35,520 Speaker 1: just gives she an opening to say, if I'm going 273 00:14:35,560 --> 00:14:37,640 Speaker 1: to keep doing this for you, what are you going 274 00:14:37,720 --> 00:14:40,440 Speaker 1: to do for me? And maybe Trump's answer to that 275 00:14:41,000 --> 00:14:42,760 Speaker 1: is will go easy on you when it comes to 276 00:14:42,760 --> 00:14:45,880 Speaker 1: some of these other sort of sectorial tariffs. But even 277 00:14:45,920 --> 00:14:48,160 Speaker 1: if that is the answer, that's a win for she 278 00:14:48,320 --> 00:14:50,360 Speaker 1: because before he didn't have that leverage, he would have 279 00:14:50,360 --> 00:14:53,800 Speaker 1: had to find something different. So it will be interesting 280 00:14:53,840 --> 00:14:56,960 Speaker 1: to see sort of how strongly the Chinese play their hand. 281 00:14:57,600 --> 00:14:59,240 Speaker 1: On the other hand, I don't think they want to 282 00:14:59,280 --> 00:15:02,480 Speaker 1: rock the boat too much, so maybe they just decide 283 00:15:02,560 --> 00:15:05,240 Speaker 1: the status quoba is a good thing. You know, it's 284 00:15:05,280 --> 00:15:06,640 Speaker 1: better to have a bed in the hand and two 285 00:15:06,680 --> 00:15:10,400 Speaker 1: in the tree, and they keep sort of targeting that. 286 00:15:10,840 --> 00:15:12,800 Speaker 1: But certainly she has more options now than he did 287 00:15:12,840 --> 00:15:13,520 Speaker 1: a few weeks ago. 288 00:15:14,720 --> 00:15:16,960 Speaker 2: What would be the dream scenario for a president? 289 00:15:17,040 --> 00:15:20,120 Speaker 1: Shoe h Jinping has two things he really cares about 290 00:15:20,120 --> 00:15:23,760 Speaker 1: getting from the US. It is access to the highest 291 00:15:23,840 --> 00:15:27,360 Speaker 1: end in video chips, and it is some kind of 292 00:15:27,400 --> 00:15:30,200 Speaker 1: concession on Taiwan. And I think if you're sat in 293 00:15:30,200 --> 00:15:32,520 Speaker 1: beaging thinking what's the biggest thing I can get here? 294 00:15:32,560 --> 00:15:35,240 Speaker 1: If it's my best moment, then you're going to push. 295 00:15:35,320 --> 00:15:38,080 Speaker 1: And Trump has already signaled that he actually is. He's 296 00:15:38,200 --> 00:15:41,120 Speaker 1: much more open to giving them those top chips than 297 00:15:41,160 --> 00:15:44,640 Speaker 1: any other US leader or politician is. And then on Taiwan, 298 00:15:44,720 --> 00:15:49,040 Speaker 1: they want stronger language around opposing Taiwan independence, which would 299 00:15:49,080 --> 00:15:51,520 Speaker 1: be a big blow for Taiwan if that language changes. 300 00:15:52,000 --> 00:15:55,040 Speaker 1: And they want Trump to stop selling Taiwan so many 301 00:15:55,080 --> 00:15:56,840 Speaker 1: weapons so. 302 00:15:56,800 --> 00:15:58,080 Speaker 2: He could actually get what he wants. 303 00:15:58,200 --> 00:15:59,840 Speaker 1: It should Yeah good. 304 00:16:07,240 --> 00:16:10,720 Speaker 2: This is The Big Take Asia from Bloomberg News. I'm wanha. 305 00:16:11,240 --> 00:16:13,840 Speaker 2: To get more from The Big Take and unlimited access 306 00:16:13,840 --> 00:16:16,680 Speaker 2: to all of Bloomberg dot Com, subscribe today at Bloomberg 307 00:16:16,720 --> 00:16:20,040 Speaker 2: dot com slash podcast Offer. If you liked the episode, 308 00:16:20,120 --> 00:16:22,320 Speaker 2: make sure to subscribe and review The Big Take Asia 309 00:16:22,400 --> 00:16:25,240 Speaker 2: wherever you listen to podcasts. It really helps people find 310 00:16:25,240 --> 00:16:27,360 Speaker 2: the show. Thanks for listening, See you next time.