According to Trump, country leaders from around the world contacted his administration after the tariff announcement on “Liberation Day” to make a deal. But …
nearly two weeks later no agreements have been signed, and pressure is mounting to finalize at least one. Treasury Secretary Scott Bessent is now promoting a "first mover advantage" to encourage swift negotiations, though global uncertainty and resistance to rushed decisions have left key allies hesitant to commit.
For example:
Japan's prime minister Shigeru Ishib said he was in no rush to agree to a deal with the U.S. as trade negotiations kick off in-person in Washington D.C. this week—perhaps not the reaction Trump was looking for when he imposed a 24% "reciprocal" hike on the country on April 2.
“We may fail if we rush, and I don’t think it’s good to compromise a lot in order to just get the negotiations done,” Ishiba said in parliament yesterday.
And the strategy of “first mover” appears flawed. First, trade negotiations are no small undertaking:
Trade negotiations are no small undertaking, with billions of dollars of goods and services on the line and potential regulatory changes also an option. But while the Trump administration made it clear it wants to act quickly, not a single deal is yet to be signed even with Canada and Mexico, who were first subjected to tariff threats back in January.
Second, the strategy itself seems a bad one under such circumstances:
… research into the first mover theory could suggest why countries are resistant to be the quickest to sign a deal. Writing on a microeconomic scale of business and first mover advantage, Fernando F. Suarez and Gianvito Lanzolla wrote in the Harvard Business Review in 2005 that the benefits of reacting quickest lessens in a more uncertain environment.
And this is precisely the economic landscape that nations are operating in at the moment, with the likes of JPMorgan Chase CEO Jamie Dimon saying that uncertainty is having a damaging impact on markets.
Seems “Liberation Day” was more about letting the clowns out of the White House than benefiting American trade.
