When President Trump officially announced the tariffs his administration would place on countries around the world just over a month ago, he warned that there would be a painful adjustment period. But he also claimed that it would be worth it in the end. And while it is still far too early to know if he was correct, the trade deal he announced with the United Kingdom yesterday morning could offer a glimpse into what’s to come.
As of yesterday, leaders from both nations continued to emphasize that the details of their agreement were still being finalized, but the broad strokes appear to be set:
- The 10 percent tariff that the Trump administration imposed on most nations will remain in place for England as well. However, Britain will be able to send 100,000 cars annually into the United States without further cost—reduced from the 25 percent that was previously placed on British vehicles. America is the largest market for English cars.
- The UK will join the US in imposing 25 percent tariffs on all foreign steel and aluminum, though those materials will be traded freely between the two countries. Considering that Britain sent roughly $492 million worth of steel to the US last year, the lack of tariffs here is a significant development. In addition, pharmaceuticals are similarly exempt from any tariffs.
- In return, American beef, ethanol, and other agricultural products will be newly available in England and will be allowed to enter the country through a streamlined process. Together, they are expected to account for roughly $5 billion worth of exports.
- The US already runs a trade surplus with the UK, which made negotiations simpler. That said, Trump also noted in his press conference announcing the deal that “The UK was largely closed, very much closed to trade, and now it’s opened,” which could have further implications for American exports to the country down the line.
While the trade has given some reason for optimism that future deals will be similarly successful, there is reason to doubt that the agreement with England will prove to be a model for other nations.
Of the governments with which the US is negotiating, Britain was among the most motivated. In fact, the deal was the culmination of nearly a decade of work by the nation’s leaders to reach a bilateral trade agreement with the US. Former Prime Minister Boris Johnson spoke of a future trade deal with America as one of the motivations for Brexit back in 2016 but, until yesterday, it had yet to happen.
As Trump’s administration continues its talks with other countries, it’s unclear to what degree these negotiations will mirror what happens going forward. And while some economists expect trade deals with Japan and India to come next, the situation with China will continue to loom largest until some resolution is achieved. Fortunately, it appears steps are being taken to do just that.
Is China next?
China recently announced that it would meet with Treasury Secretary Scott Bessent in Switzerland this weekend. The talks will be the first steps toward a more substantive negotiation since mutually escalating tariffs essentially shut down all trade between the world’s two largest economies.
Both sides have attempted to convey a position of strength heading into the talks, but the truth is that each is suffering from the current economic environment. Chinese factories, for example, experienced their steepest slowdown in over a year, while the American economy has been marred by unpredictability and fear.
Again, none of this should come as a surprise. Charging more to bring a product into a country than you can charge to sell it—the reality in both the US and China—is not exactly a great way to make a profit.
However, there is reason for hope. While this week’s negotiations are unlikely to lead to a deal, President Trump did sound open to a significant de-escalation if the talks go well. Some expect the rates to drop to as low as 50 percent while discussions continue, though it’s unclear if the administration would really be willing to reduce them by that much.
The mere hope that the deal with England and the talks with China could result in a more stable and profitable economy was enough to send markets soaring in the US, though.
And that reaction, based on little more than educated guesses and hope about the future, offers an important reminder for each of us today.
The only one not guessing
One of the primary reasons markets have fluctuated so much in recent weeks is that the Trump administration’s tariff policies, as well as the response from other nations, have removed much of the predictability people used to believe was built into the marketplace. Such volatility is why it’s important not to take promises of better days or imminent doom too seriously.
That doesn’t mean you should stick your head in the sand or act as though what goes on in the rest of the world won’t impact you. But remember that even the experts are guessing on this stuff. They’re hopefully making educated guesses, but they’re still just guesses.
And that’s the case for far more than the economy.
One reason Jesus tells us not to worry about tomorrow is that we can’t know what tomorrow will bring (Matthew 6:34). It’s alright to plan, and we should exercise wise stewardship over the gifts he’s given us. But, at the end of the day, God is the only one who knows the future. He’s the only one who is not guessing.
As such, the most logical response we can have to the volatility and unpredictability of our current circumstances is to trust God and follow his lead.
Doing so doesn’t mean we’ll never struggle or that there will never be situations where we’re taken by surprise. But if we’ve placed our faith in Christ and truly handed our lives over to him, then even when the unexpected and painful happen, it doesn’t have to rob us of the peace and joy found in our relationship with him (Galatians 5:22).
And one of the best ways to help people see the power of Christ is to exude his peace and joy at a time when he is the only logical explanation for them.
So the next time you see the markets stumble, come across some other troubling story in the news, or encounter a hardship that reminds you of just how little control we really have in this world, take your fears and anxieties to God. Then embrace the peace and joy that only he can give.
Let’s start right now.
Quote of the day:
“Worry does not empty tomorrow of its sorrow. It empties today of its strength.” —Corrie Ten Boom
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