AFP31 July 2025 | 16:26

Trump's global trade policy faces test, hours from tariff deadline

President Donald Trump's dream of a new world trade order faced a crucial test Thursday, with dozens of economies – including key commercial partners like Canada - yet to secure US tariff deals ahead of a midnight deadline.

Trump's global trade policy faces test, hours from tariff deadline

US President Donald Trump speaks during a bilateral meeting at the Trump Turnberry Golf Courses, in Turnberry south west Scotland on 28 July 2025. Picture: Christopher Furlong/POOL/AFP

WASHINGTON - President Donald Trump's dream of a new world trade order faced a crucial test Thursday, with dozens of economies – including key commercial partners like Canada - yet to secure US tariff deals ahead of a midnight deadline.

The last-gasp scramble to strike bilateral accords came as an appeals court in Washington considered the legality behind Trump's strategy of invoking emergency economic powers to declare sweeping duties on imports.

The 79-year-old Republican doubled down on the wide-ranging levies, posting on Truth Social: "Tariffs are making America GREAT & RICH Again."

He insisted in a separate post that the world's biggest economy would have "no chance of survival or success" without protectionist measures.

But question marks linger over the effectiveness of Trump's grand plan - and whether he will really follow through on his most dramatic threats.

In a sign of flexibility, he announced Friday that he was delaying a tariff hike on Mexican products originally due Friday for 90 days after talks with counterpart Claudia Sheinbaum.

Other road bumps remain.

While Trump has touted a surge in customs revenues since fresh tariffs were imposed this year, economists warn the duties could fuel inflation.

And the US Court of Appeals for the Federal Circuit, meanwhile, was hearing arguments Thursday in cases brought against Trump's blanket tariffs targeting various economies.

A government lawyer told the court that Trump's tariff orders were covered by "broad discretion" he enjoys when it comes to handling national emergencies - including pressing economic issues.

A lower court's ruling had blocked most of the duties from taking effect, prompting the Trump administration's challenge and the duties have been allowed to stay in place for now.

DEAL OR NO DEAL

So far, Washington has announced pacts with Britain, Vietnam, Japan, Indonesia, the Philippines, South Korea and the European Union, with those new rates expected to take effect Friday.

South Korea squeezed in a last-minute agreement on a 15 percent tariff, significantly below the 25 percent that Trump threatened on its goods.

But Trump announced 50 percent tariffs on Brazilian products - while postponing imposition and allowing key exemptions - as an effort to pressure the US ally to drop its prosecution of right-wing former president Jair Bolsonaro on coup charges.

He also unveiled a 25 percent levy on Indian imports, and warned Canada it would face trade repercussions for planning to recognize a Palestinian state.

And the details of the agreements that have been made remain vague.

For example, the EU, while having reached a pact, continues pushing for a carve-out for its wine industry.

Looming over the entire global economy is the still unresolved trade tussle between the United States and its chief rival China, with the superpowers in talks to maintain a truce after earlier imposing triple-digit tariffs on each other.

CANADA THREAT

Washington has yet to finalize a deal with neighboring Canada, while Trump said he was extending existing 25 percent duties on Mexican imports.

Canada's trade relations with the United States came under renewed threat after Prime Minister Mark Carney announced plans to recognize a Palestinian state at the UN General Assembly in September.

"That will make it very hard for us to make a Trade Deal with them," Trump warned on social media.

Carney said Wednesday: "It is possible that we may not conclude talks by August 1st."

Goods covered by a North American trade pact have so far been excluded from Trump's latest tariffs.

The US tariff hikes due Friday were announced in April in a package where Trump slapped a minimum 10 percent levy on goods from almost all partners -- citing unfair trade practices.

This rate was set to rise to varying levels for dozens of countries, but Washington twice postponed their implementation.