00:00Hossuk Lee Makiyama is a senior fellow at the London School of Economics.
00:05Great to have you on the programme again, and my goodness, we've got lots to talk about.
00:09Let's start with Donald Trump, because that timeline keeps shifting.
00:14Those 90 deals that the White House said would be done in 90 days haven't materialised.
00:18So when, or will, Trump get what he wants?
00:22Well, first you have to tell me what Donald Trump wants.
00:25And that's something for psychologists and trade negotiators everywhere, I think.
00:30I mean, trade negotiation is not a business where you actually tell your counterparts or Twitter what you actually want,
00:37because you are often exaggerating your demands in order to, you aim for the move and end up somewhere in the treetops.
00:45And this is very much the case that we are dealing with a self-aggrandizising negotiator in charge,
00:51and who is not really clear about what he wants.
00:54But he has achieved a couple of things.
00:57And first of all, we have a couple of interim agreements that seem to be ready.
01:01And if we talk to inside sources in Washington, we see that already in the lines of 10, 15 interim agreements
01:10are more or less ready to go on Donald Trump's desk.
01:14And also, very important factor here is that he has broken the entire trading system that he felt was working against him.
01:21That's something he has actually achieved.
01:22But then you see, Hosok, I'm looking at these visits, Wang Yi going around Europe, preparing to go to Egypt.
01:30It makes me think, look, is there a feeling that traditional US allies like the EU, like Japan,
01:35will maybe capitulate because that trade relationship with the US is so important?
01:39Or will they start to prioritise other partners too?
01:42I think at least when it comes to Japan and Europe, I think it's very fair to say that they have prioritised other markets for quite a while now.
01:53Diversification has been their name of the game for a very long time, even before the pandemic and before the geopolitical tension started.
02:03And it's just a question about where the business can find growth.
02:07And, of course, when it comes to trade opportunities, Japan in particular has two major markets, United States and China, very closely.
02:18And it's very competitive and they can choose where they want to go.
02:21And ideally, they want to go both or at least to the country that is offering as much opportunities as possible.
02:29This has all been about reclaiming America's destiny, making America great again.
02:35But has Trump's trade policy made US companies more or less competitive globally?
02:41Or do you think we need maybe a longer term view here?
02:44I don't necessarily think it's a question about whether American companies have become more or less competitive.
02:53One factor remains true, which is that US companies are the most productive and most technology advanced in the world.
03:03The question is not so much about the companies, but it's actually a question about the national economy.
03:07What I think the Republicans, as well as the Democrats, before Donald Trump came in, trying to achieve is complete reengineering the American macro from an import-driven and consumption-driven society with heavy debt into something that looks perhaps a little bit more like Europe.
03:29Lower consumption, slightly more government spending and slightly smaller trade deficit.
03:35So we are looking at perhaps more of a macro revolution than a trade revolution, if I may say.
03:43Hosok Lee Makiyama at the London School of Economics.
03:47Thank you ever so much.
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