President Donald Trump has introduced a variety of trade tariffs targeting China, Canada, and Mexico. After negotiations with Mexican and Canadian officials, the US has delayed tariffs on imports from these countries by another month amid ongoing talks.
The president’s trade strategy has expanded beyond these nations, with discussions of potential tariffs against the EU and the UK.
Wilbur Ross, the former US Secretary of Commerce under the first Trump administration, joined Catalysts to discuss his outlook on these tariffs.
Despite the aggressive measures, Ross does not believe a trade war will materialize, despite some experts already characterizing these engagements as one. He argues that these countries “really can’t afford a rapidly escalating tariff” for two key reasons: these nations export more to the US than the US exports to them, and these countries have smaller economies.
“That makes it very much a loser’s game for them,” Ross tells Yahoo Finance. He adds that he doesn’t “see any set of circumstances under which we [the United States] would end up worse from a trade balance point of view.”
Regarding negotiations, Ross believes President Trump will not compromise unless China implements the terms agreed upon in his former term. However, the former Commerce secretary states that Canada and Mexico have made “tangible steps” in cooperating on issues like border security and drug trafficking.
When questioned about whether Trump’s policies are turning “business-unfriendly,” Ross tells Yahoo Finance: “By and large, the people who are saying that are the same people who in the first Trump administration were saying when we imposed the steel and aluminum tariffs that ‘that’ll be the end.'” He emphasizes that these critics “were wrong then and they’ll be wrong again.”
According to Ross, the fundamental purpose is to “change corporate behavior and to encourage resourcing back to the US” as opposed to globalization, which has been the primary strategy of international businesses for years.
Yahoo Finance executive editor Brian Sozzi interviewed Wilbur Ross in December 2024 on the Opening Bid podcast.
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