There are two things that Donald Trump hates. One is to be made to feel stupid, and the second one, which he hates even more, is not to be cut in on a good deal, right? So that's what he's doing when he's going around the world cutting good deals for America, but also, one assumes, when he can above board for himself. Hello and welcome to this week's edition of Trump WORLD. I'm Matt Fry in London. And I'm Anushka Astana in Washington, DC Donald Trump is in neither of our locations this
week. He is on a tour of Asia. He has been to Malaysia. He has been to Japan. And now, now South Korea, where tomorrow we're going to have a big meeting between him and President Xi Jinping, and we'll talk about that trade deal a lot. But in the meantime, there's plenty of else going on, isn't there? You bet there is.
So there was an extraordinary interview given by Steve Bannon this week to The Economist. And Steve Bannon, as you know, was, of course, Trump's chief strategist in the first Trump administration. He didn't last very long. He was sacked after, I think, six months or so. And I've got a little story about that because I met him in a hotel, in his hotel room in Rome and we spent two hours
talking to each other. And I'll tell you about that in a minute because that was quite an interesting insight. But anyway, the reason why we're talking about him now is that he gave an interview to the editor of the Economist and the deputy editor. And he said lots of incredibly abrasive things in that interview. And they were quite taken aback. And they all, it was all soft furnishings, fluffy sofas. And Bannon was on, on true Bannon revolutionary form, the Rob Speer of the MAGA movement
ready to chop their heads off. And they, I, I, you know, they dealt with it quite well, I thought. But the thing that made the headlines was his comment that he thinks Trump should serve, will serve, actually will serve or should serve a third term in office. What did you make of all that, Enochko? Well, I think my general mantra with this second Trump presidency is to take it much more seriously, as in to take what he says more seriously, I feel Trump says. What Bannon says. Or both.
Well, let's let's get to that because he Baron said it and Trump has hinted at it plenty of times as well as occasionally denying it. But even on this trip in Asia, Donald Trump when asked about it, didn't shy away from it, was hinting that maybe he would consider a third run. The only thing I think he has ruled out is the idea that he would run as vice president to JD Vance in order to find a way through the back door in he said, you know, I don't think
voters would like that. He has said before, I don't, I don't think it is, you know, allowed to do it. But he's made clear repeatedly that he might look at ways to do it. Now, Steve Bannon is talking about the idea of a secret plan that they want to put in place and has said, look, just get used to it. Basically, Donald Trump is going to be president again. This would, of course, break, I think, the 22nd Amendment, which most people think is not something that they should be
messing with. But it feels like they're messing with plenty of the Constitution beyond this, including around free speech and how they deal with free speech. So why wouldn't they consider this? I mean, there is an age issue here as well as a huge constitutional issue. If he were to run for a third term, he'd be 86 by the time he completed that third run. But I, I, I don't see any reason why not to believe that Donald Trump is interested in it and is looking for a way.
And you know, when you talk about secret plans, you know, one thing I've been thinking about a lot this week and I'm sure in future episodes we'll talk about it, is so-called Project 2025, a 900 page blueprint for office that Donald Trump once claimed he'd never heard of. He then put its architects into senior positions in the White House. And now he talks much more proudly of it. Why shouldn't we believe both Steve Bannon and Donald Trump that they're at least
considering this? I agree with all that. Just a few little bit of context. I mean, the, the idea that you run for a third term Once Upon a time, you know, during the Second World War was completely normal. FDR ran 4 consecutive terms in office. And then after that, it was thought that this would be too much and it would turn, you know, make America look a little bit too much like a kind of dictatorship, which you could argue is what Trump wants.
What worries me about Steve Bannon in that particular interview and having met the guy twice, is that he is a Yeah, I. Want to hear about your two hour meeting? OK, but it was, it was an interesting meeting. Let me just tell you about that briefly then. So Steve Bannon had been sacked and he'd more or less disappeared into a witness protection programme. No one knew where the hell he was. And I happened to be in Rome for the Italian elections. I think this was 2018, if I'm not mistaken.
It was March, it was rainy, it was miserable. And there was a picture of Steve Bannon and literally no one had seen her in public, sort of by Plaza Novona in the centre of Rome. And I thought, ah, OK, the guy's in town. He's not giving interviews. He's kept a low profile. I bet you he's staying at the Raphael Hotel, which is a sort of Ivy clad boutique hotel next to Piazza Navona. Anyway, I walk into the hotel lobby and I say I'd like to see my old friend Steve Bannon at
that stage. I've never met the guy. And the woman says that's room 518. Bingo, right. And then at that moment, these two heavies get up in the in the in the lobby. They were clearly his bodyguards and said, why are you here to see Steve? I've also written this book on Italy and I'm sure he's here for the Italian elections and I'd and I'd love to talk to him about those. Anyway, I waited in the lobby for 10 minutes. I was then summoned up to his room and he opened the door.
It was dark inside. And he he held out the phone, which had the Amazon order number of my book on Italy, Italy, the unfinished Revolution on it. And I promise you, Anouska, I didn't think anyone had ordered that book in a decade, right? But he ordered it. He found it, which is a very flattering thing to do. And then he invited me in. And he was such a notorious character at the time, even more so than now because he was essentially, you know, Trump's brain running this first Trump
administration. And it was a sweet. And there was a bottle of wine that had not been opened, although there's always something vaguely unsober about the way he appears. He hadn't touched a drop of alcohol. And I didn't drink either. And then we spent two hours without cameras talking.
And the. So it's it's worth, you know, giving you the build up to then describe what happened, which is that he offloaded about Donald Trump and Jared Kushner and Ivanka and Melania with a degree of rudeness that would make the most, you know, effervescent episodes of in the thick of it look tame by comparison. I mean it he was dropping F bombs like there was no tomorrow. And he basically said Trump is more or less, you know, he wasn't very complimentary about him.
It's off. It was off the record. So I can't, I'm not going to quote you for him, but the general mood of it was this guy, you know, is not as smart as he thinks he is, but I'm really, really smart. And what? But what did also come across, and this is what came across in the Economist interview, is that
Bannon is a real revolutionary. He really genuinely believes that America is fighting a revolution to what he calls getting back to genuine capitalism, away from corporatism in favour of the little guy or the average guy who's been screwed by the big companies. And of course, Bernie Sanders would, you know, heartily agree with him on that one. So would Zoran Mandami, the guy who's going to be the next mayor of New York, most likely. AOC probably as well. He's a true revolutionary.
Trump running for a third term is is kind of the least of his points. Of course he'd run for a third term because it's a revolution that has to be completed and he won't be able to get it done in the next three years. So it's more what worries me more actually than the third term idea that Bannon put out there is the revolutionary zeal in this idea that America is at war with itself, that this is a war against the so-called liberal woke elite.
Caller what you like. I mean, I think Bannon honestly, I think is quite happy to see this come to blows, to see another kind of civil war in America for his vision to prevail. And that is deeply alarming. I mean, as you know, Anushka, with Trump always having to balance the stuff that he does on the global stage with the stuff that he does at home. And the Bannon interview is very
much in the latter category. And I do think we have to look at the first nine months of the Trump administration, let alone the next three years, and what might happen afterwards as a kind of revolutionary approach to American governance. You know, challenging, possibly tearing up the Constitution, taking on the big institutions of the American state, whether it's the federal government or elite universities like Harvard. I mean, Trump's got a lot of fighting him.
It was all announced in Project 2025. And that old cliche in the first administration, you've got to take him seriously but not literally is nonsense. You've got to take him seriously and literally. And of course, that is what foreign leaders are learning as well. They're they're on a learning curve how to deal with Donald Trump.
And this week it was the turn of Asia and starting off for Southeast Asia and Oshka. Yeah, What I find really interesting is to watch the way foreign leaders are fawning to Trump because they really genuinely think he can have an influence on, you know, conflicts around the world. And I I think that is genuine. I think they believe that he can have. And we've seen that this week. In fact, in Malaysia, he was there overseeing a signing of an agreement between Thailand and Cambodia.
He called it a peace deal. I noticed that the Thai foreign minister afterwards, when asked, is this a peace deal, wouldn't actually go there. But he did talk about a pathway
to peace. We had a situation in which the Cambodian PM said publicly, I want to nominate you for a Nobel Peace, Peace Prize. And we're told actually by the White House press secretary Caroline Levitt, that Prime Minister Taikachi, the new Prime Minister in Japan, has also told Donald Trump that she too will nominate him for a Nobel Peace Prize. Although Japan, and I think they have history on this because I think they actually nominated
him back in 2019, they never say publicly because they believe the Nobel Peace Prize process says you shouldn't do that.
And as you say, at the same time, you know, and there's genuine actually, I should mention Sudan as well, you know, talking to people in the region over this week, they were saying to me, every person involved in peacekeeping on the ground wants to get the ear of Donald Trump. They believe genuinely that his influence can make a difference because it actually brings both sides to the table in a way that perhaps previous people had not done, including actually Biden when it comes to Sudan.
But at the same time as they are fawning to him all over the world, really falling over for themselves because they know that that's one of the things he likes. As you say, there's sort of extraordinary things happening in the US. And, you know, I was actually talking to someone really, really senior diplomatically in a European country this week who was who was asking the question
genuinely. I wonder how history will judge us for the way that we've decided to go down this path, for the way that we've decided to suck up to him. Because at the same time, how will history judge what is happening here on the ground in the US and how far is he prepared to go with that blueprint for power that we've talked about now? Now, the question I also have is how much are the people in the US focused on what he's doing abroad, You know, even on the Israel Gaza deal, which of
course got huge headlines here. I do wonder when you're watching quite a lot of the news channels here, it wasn't the same level of emphasis. I don't think that you perhaps get in some parts of the world. The focus has still been more heavily on what's happening here in the US on the shutdown, on, you know, questions again today over President Biden's fitness in terms of his health. You know, I noticed that was leading Fox News this morning, not, you know, whatever he is
signing in Asia right now. That's not to say that it doesn't cut through at all, but I just think, you know, how is he playing this? It's like this completely different character, Jekyll and Hyde, home and abroad, and what do the Americans? It is all about the exercise of Trump's power in different ways. So if you just look at the last week, you know, Trump power comes in different shapes and sizes. It's packaged in different ways.
So the most obvious recipient of Trump's, you know, generosity was one Javier Miley, the president of Argentina, who was going to lose a midterm election and has now won that election. Rather, his party's won the election in a midterm election.
But it was essential for him to win it in order to continue his revolutionary libertarian economic programme, a sort of condensation of what Musk was always all about, you know, cut down the federal government to the bone, then lower taxes, deregulate, deregulate, deregulate. And then the kind of animal instincts of capitalism will take over, which is why Miley always campaigned with a chainsaw. Well, you know, the Argentinians
didn't really like it very much. There was a corruption scandal around his sister, who's also his chief of staff and his his sort of chief social media officer, who's the third most influential person in the whole country. They were embroiled in a scandal. The economy didn't do quite as well as Milay had promised. It all went basically South. And then Trump to save his friend. And he really regards Milay as a kind of fellow revolutionary, as does Bannon, by the way.
Trump said, look, you know, I'm going to give you the first. It was 20 billion. Then it was $40 billion. You personally in Argentina to guarantee the state of the economy and to help your peso, your currency. But if you don't elect Milo's party, dear Argentinians, in this coming election, that money goes. Can you imagine? I was actually watching the polls when they originally made that offer and, and they did literally spike for Milo's party after America intervened.
And, and watching, you know, Scott Besson, the Treasury Secretary, was also talking about that original $20 million when Miley visited the White House and was absolutely clear that basically we support your politics. We cannot let communists, as they were saying, get in. And we've seen a very different reaction to left wing governments in South America. So, so let's you know in terms of this Asia trip. I tell you, can I just add 1
little thing? You, you mentioned that you know that everyone, everyone have you. By the way, have you nominated him yet for a Nobel Prize? Because I have, and I I don't know if you've actually done that. And don't, don't smile so insincerely. This. Is important. Show me that e-mail trail. You should. Nominate him for a prize.
We could do it together. Trump, well, nominates Trump for a Nobel Peace Prize. But look, there must be someone, somewhere must have written a sort of checklist of all the things you need to do to avoid the worst treatment of Trump. So nominate him for that sodding prize. Then do what the Malaysian did Anwar Ibrahim in two interesting things. When Trump arrived in Malaysia, Anwar Ibrahim laid on the Malaysian Air Force as an
escort. That is a really good idea, as long as Trump doesn't feel that those planes might collide or shoot him down. And then, rather daringly, he made a joke about Trump possibly going to jail. Which was really not in the it's not in the guidebook. He said, of course we have something in common. President Trump, I spent 10 years in jail and you almost went to jail last year. I'm not sure if Trump smiled at
that stage or not. But the other thing to do is, and this is what the Japanese Prime Minister, the newly elected female Prime Minister of Japan, which who Trump hailed to the heavens. Did you increase defence spending in her case to 2% of GDP, which for for Japan, you know, a country post to Roshimi that is sort of built on the the doctrine of peace is a massive deal.
And of course, guess who else raised defence spending before they first went to visit Donald J Trump in the White House won Keir Starmer raised it to whatever 2 1/2% and cut the aid budget. People are doing things in domestic policy that are contentious in order to suck up to him. You could well whether you would argue NATO countries raising defence spending as contentious or not. I think it's fairly popular as well among populations. But they're doing it.
The timing of it is all to do with him. I mean, they were doing it anyway. Yeah, but they're doing it more. Yeah, and, and, and unwinding which bits of these are him having a positive impact on the world and which are him having a chilling impact on the world. You know, it's quite complicated. The NATO General Secretary General, Mark Rutter, was here last week and I managed to speak to him in the corridors.
And he he was making the argument that it's only because of Trump that NATO are increasing those spending limits, but also saying it in a way because he knows that that's what Trump wants to hear. Interestingly though, in Japan, you know, lots of warm words, all the sycophancy we've seen elsewhere, the private promise of the nomination, but actually, actually not a trade deal, not a trade breakthrough. They have signed a memorandum of understanding.
There's some things in there, but this doesn't go all the way does. It no, it doesn't. It doesn't go all the way. And but remember also Japan was slapped with 25% tariffs on Liberation Day. That was then commuted down to I think 15% tariffs. And but Japan, you know, Trump always has always really liked Japan. And he loved as much as Trump
can love any foreign leader. He loved Shinzo Abe, the late Japanese leader, Prime Minister, who was mentored to the current new Japanese Prime Minister. He adored Abe. Abe was constantly over at Mar a Lago, not on official visits, but to play golf with Trump. They really hit it off with each other. And remember also that she rather like Abe himself, it's very conservative. You know, she styles herself as the Iron Lady of Japan. Her big model is Margaret Thatcher.
She wears Blue Jackets and big pearls like Maggie did. And you know, of course, you know, Trump's got nice things, very nice things to say about Margaret Thatcher. So I think ideologically they are aligned. She has done the right thing on defence spending. She's also promised to spend, I think it's 100 billion U.S. dollars on American defence equipment, which is always, you know, another part of the kind of the Trump welcoming package.
And crucially, and this was the kind of point of the Southeast Asian tour, what Trump is trying to do, having basically burned quite a few Asian bridges after Liberation Day, is trying to rebuild those bridges on his own terms so that he can re stitch what used to be quite ineffective, what they call the Alliance of Islands, the ring of islands around China.
It's about containing China. And if you want to contain China, and we'll get to China in a minute, you've got to get on with the Japanese. You've got to get on with the South Koreans. And you've really got to get on with all those, you know, Southeast Asian factory nations that have been producing, you know, Nikes sneakers and various other things and selling them very cheaply to the US.
And they're really in a bind because they don't they don't trust China because China is their regional behemoth. And they used to really trust the US after the Vietnam War, but let's not talk about that. They used to really trust the US And the US was buying all their stuff, and then suddenly the US turned against them. So Trump has a problem in that he's burning. He's been burning so many bridges, and he's now trying to rebuild them, but on
transactional Trump terms. And I just wonder whether that kind of alliance will in the end, be enough to contain China because, of course, China makes a lot of the stuff in those countries in Southeast Asia. That's the circle. China plus one policy to get around American sanctions. So this, you know, But what Trump has realized at the very least, is that when it comes to, you know, the pulse of the world economy, it ain't in Europe, it's in Asia.
Yeah. Let's talk about the meeting with XI just before we go into it in detail. I just think it is worth saying from what you've been saying there, and I think this every time I hear about Trump's relations with countries all over the world, you've always got to notice that the economic of interests of America, even in these peace agreements, is absolutely what that is going in
for. Making a deal like even, you know, the conflicts which at the end have mining contracts that America is going to benefit from and so on, which is why those in parts of the world that don't have massive economic interests are concerned because they don't have it. Now, what China has in spades is things that America wants and that has been causing problems for Donald Trump as he's triggered the possibility of a trade war.
Over the, you know, preceding months, he's talked about 100% tariffs on China. He's got a problem because China has stopped buying soya beans from American farmers, and that has caused a bit of a crisis here in the US And secondly, China has almost all of the world's rare earth minerals, which we need for the electronics that are so important here in the US. They're talking about the framework of a deal. How do you feel this meeting's
going to go, Matt? Well, what's so interesting about the China meeting is that, first of all, it's a bit late in coming. I mean, they should have had a meeting much earlier, but there's been so much shadow boxing and there's been such a kind of trade war between the two of them. It's been virtually impossible so far. Before we get to the, I want to have, I have a lot to say about China and I know reasonable. I used to be based in Asia. I went to China.
You know, I did Mandarin at school when I was 18 and I went to China for three months in 1981 by myself. I was the loneliest person I've ever met. Shenzhen, which is now a mega city of 26,000,000, was then a city, a town actually, of 10,000 people. Anyway, just briefly, Bannon, what Bannon said to me in in my meeting with him in Rome is that the two things that Donald Trump hates, one is to be made to feel stupid. And the second one, which he hates even more, is not to be
cut in on a good deal, right? So that's what he's doing when he's going around the world cutting good deals for America, but also one assumes when he can above board for himself. Now with China, he thought back on Liberation Day that, you know, looking at the trade balance, the Chinese sellers five times as many things as we sell them, that he had the way he wanted them. That, you know, he could increase tariffs. And the initial stages, it was like, I think 45%. And they would bow to his
greater will. Except the Chinese, having tasted some of Trump's trade tariff eye in the first administration, has spent the last five years getting ready for the next round of Trump tariffs, which did not hit them with any surprise. And what they knew they had that American doesn't just want but needs is not just the rare earth metals, but also pharmaceutical products. There were 700 pharmaceutical products that cover everything from cancer to allergies, you know, to, you know, heart
medicine. Some of it Trump might be on himself, you know, and if you live in America, it's nothing but medical ads on television. 700 of these antibiotics, 700 of these can only be made because China is selling America the chemicals in order, the pharmaceutical products in order
to make those things. That's on top of the rare earth metals, which we've talked about a lot recently, which go into everything from smartphones to F30 fives, you know, everything in America that is kind of digital and moves has got, you know, a rare earth metal in it. Now, why are the Americans not making the stuff themselves? Well, they used to make it in the in the early noughties, America had two big rare earth, you know, mines, I think one in Arizona, one in New Mexico.
But then they weren't making a lot of money because the Chinese were making the stuff more cheaply. And also they're very dirty to mine. And in China they don't really give a stuff about the environment. Whereas in America you kind of, they do, oddly enough, they did, they did well, they, they did, you know, even when it was Jewel, baby Jewel, they still
did. And so the Americans, like so much else, outsourced this to China because it was cheaper and there was a very efficient production and delivery line. And of course, that put the Chinese in a position where they are literally, they don't just mine 65% of rare earths, they process 90% of the stuff. So one of the other deals that he's discussing with Japan is how to mine rare earth metals.
I don't know if Japan has them. Actually, lots of countries do, Ukraine included and how to process them. So and, and of course, where he's right is that everyone else and in Asia, they're more afraid of China than they are in the US because they know what China feels like up close and personal. He's got a sort of coalition of the winning going on trying to get a rare earths out of the soil and process them. And Australia is also part of
that deal. But that's but what he but for him, he didn't really take that into account. He thought if we stop buying the Barbie dolls that they make, and by the way, they're not making them anymore because they're now made in Vietnam, then they will hurt so much that they will just buckle. And he was wrong on one thing, though. I think we have to be, you know, we have to be fair, not to him necessarily, but to the balance
of this trade war. Yes, the Chinese have the Americans by the short and curlies on rare earth metals and pharmaceuticals, but China is in the middle of a major manufacturing bubble. They had a housing bubble until about 3 years ago, which was in is still in danger of bursting catastrophically. You know, 10s of millions of Chinese, formerly farmers now, now factory workers or clerks bought flats that they thought worth was, were worth something and they're not worth that anymore.
And that they're kind of knee deep in mortgages. And so the along comes this idea from Xi Jinping. We've got to build up our factory capacity. We have to become the world's manufacturing hub, which is indeed what they've done. You want to build anything, you build it cheaper and faster and more efficiently in China than anywhere else on the planet. But this capacity has to go somewhere. They've got to sell the stuff they make. And if America isn't buying that
anymore, it'll help. It'll hurt American consumers because their Barbie dolls or their television sets or fridges will be more expensive. And they weren't like that. But it'll really hurt China as well. Yeah. So both sides have a massive motivation to try to come to some sort of deal. I'm not sure if Donald Trump was quite aware of the size of the motivation on his side, as you say.
And look, I always find with all of this is, you know, people might not believe that the way he's gone about tariffs is the right way to go about it. And clearly tariffs are going to impose a cost, a financial cost on American consumers.
But also, is there an underlying argument there which isn't untrue, which is, you know, when you talked about the idea that, you know, they decided to take the rare earth minerals all from China and many of these other goods, you know, you know, you could argue that was because China was using cheap labour to buy these goods rather, you know, to make these goods rather than a comparative advantage in the way economists would originally and purely have talked about it.
So I think the issue here is, and I find this in America, there's no big outcry about Trump's tariffs at the moment, partly because I think people sort of by his underlying argument for it. The question is if and when the prices start to rise at a level. But it's really quite painful. I think that's huge because I think that was one of the biggest factors in the last election. And I think it's hard to get around that basically.
Absolutely, and especially for people who are, you know, who don't earn a lot of money, inflation hits low income families much harder than others. But the other thing is that remember the the China tariffs haven't actually kicked in yet because they've been kicked into the long grass. So any inflation resulting from China towers we won't have seen yet. We, we will get to see that next year.
And the other really fascinating thing about Trump is it like so much in the world, he's, he's sort of 100 years behind everyone else. So he's obsessed with American manufacturing and reviving American manufacturing. Like, you know, in the good old days of Bethlehem Steel and you know, all these big company, you know, all the early days of the, of the, of the car, the car companies, the car giants. But of course, he doesn't take into account and rarely talks
about automation. So if you're a company that can't produce stuff cheaply in China, you produce it in America with robots and with AI and, and you're still not going to give those poor American workers their jobs back. The other thing is that he regards tariffs very much as what they used to be literally 100 years ago when the government, the federal government of Washington made much more money from tariffs with other countries than it did
from taxes. There was, there was virtually no income tax that people collected that the federal government collected in those days, but there was quite a lot of money, more money that they collected by charging people who wanted to trade with America. So again, I don't know what he's reading, you know, or if he's reading or who he's listening to. He's got a very 19th century mindset, not just about how power works on the world stage,
but also how the economy or the economic cookie crumbles. And, you know, and at the same time, yes, he, you know, he, he's interested in AI and he's fascinated by all that. And he's trying to bring lots of money into America to make sure that, you know, they, they, they stay ahead of the game. But even on that one, you remember, you know, the Americans picked a war with Huawei, the electronics giant in China that makes mobile phones, but now also makes cars.
And the idea was from the first Trump administration, you kill off Huawei because we don't trust them, because they're a Chinese company trying to encroach on our markets. And you do this by denying them American made microchips. Well, guess what? The Chinese then made their own chips. They made them just as well, but a lot more cheaply. And Huawei instead of dying has become this resurgent, you know, digital era phone company turned car company empire that is extraordinarily successful.
And so you mess with the Chinese at your peril. And and the Chinese are very good at using the government, the central government, either with tax incentives or regulations to basically allow Chinese companies not just to succeed, but also to fail and not be punished for it. And so the idea to getting back to rare earth metals in America, it's all down to the free market company mines rare earth metals. They're not making a ton of money out of it.
They find it easier if they do that in China. The Chinese set up rare earth metal mining companies left, right and centre. They allow four out of the 10 they've set up to go to the wall. The other six thrive. They don't give a stuff about the environment and then and then.
So it's Chinese industrial policy combined with free market capitalism, that and, and an equal and a legal structure that allows companies to to fail without too much punishment or to thrive, you know, and they've relatively low tax rate. I mean, they've basically taken America's capitalist game and beaten them at it. And Trump hates that.
He hates it. One thing I do wonder about what we're going to see out of this agreement that we'll see tomorrow and the meeting is it's all based on fixing smaller sectoral issues. So there'll be an agreement on soya beans and there'll be an agreement on rare earth minerals, which will stop China from going ahead with a plan to halt exports or control exports to the US. But actually, the question of trade between China and the US
is a much bigger one. It's one that has massive implications for the entire world because of the size of the two economies. It is one that actually, you know, goes back decades. You know, America has never been happy since China was part of the World Trade Organization. Never thought it played by the rules in a fairway. That's right to a good point. They cheated, yeah.
And, and so is, is a kind of agreement which is very focused on individual sectoral issues actually going to fix the really big tension between these countries? And, and just as we're talking about this, China is the third biggest exporter into the US you know, Canada is above it. And I just want to talk very briefly about what's happened in Canada, because it is so interesting.
So the Ontario government put out an advert in which they essentially played the voice of former President Ronald Reagan, obviously a hero to many on the right in America, talking about the need for free trade and how tariffs really hurt people and how they hurt American consumers and they hurt jobs and so on. And there was a complaint by an organization sort of set up in Ronald Reagan's name that it had misinterpreted what Ronald Reagan had actually stood for, missed out the context.
Donald Trump got angry about it and slapped additional tariffs on Canada as a result of all of this. And I just yesterday, I went back and I watched the original radio delivery. It was radio, but it was also filmed of Ronald Reagan and watched it to see whether it was in context. And it was so interesting to listen to it. It is true that the context was that they had put tariffs on a few individual things with Japan at the time, because there was a very specific argument to do it.
And what Ronald Reagan was trying to argue was there was a really specific reason why I'm doing this. But let me be clear. I believe in free trade on the whole. I mean, the radio address, if people were to go and listen to it, is stronger than the Ontario advert. It is basically saying tariffs hurt people, they hurt our people, they hurt our consumers,
they hurt our workers. And we should never go down the line of trying to trigger a trade war because if we do, gosh, the consequences will be huge. It's fascinating. I never knew that Trump would take Reagan quite so seriously, or rather want to protect him so much. Or whatever it is. I just just before we go really important on Xi Jinping meeting Donald Trump there, there's something puzzling about Donald, Donald Trump's attitude to China.
And I knew that he, he's been wary of China for a long time because when I interviewed him back in 2013 and I said you don't pick a fight with your banker China, that stage was the biggest buyer of U.S. Treasury bills. He called me stupid to my face, which is of course, a golden moment. You want to be called stupid by Donald Trump, but he really likes Xi Jinping. He really admires him and he's been quite open about it.
But he's very wary of China and sees China as the global competitor, America competitor to America, probably accurately. I think that that is definitely what's happening right here. But this love affair with Xi Jinping is really interesting.
And what I worry about on behalf of Taiwan, remember Taiwan is that this, you know, this plucky, very wealthy island nation that by the way, produces 90% of the fastest superconductor chips that are used anywhere, you know, from fighter jets to refrigerators, you know, they, they're produced in Taiwan. So Taiwan also has something that everyone else needs and wants, but Taiwan doesn't want to be part of China. The, the president of Taiwan who
was recently elected is more anti Chinese or anti the idea of reunification than the previous one was. And So what does Trump do here? Does he do what Biden did? Who actually went out of his way to say, I'm going to defend Taiwan, China, if you attack Taiwan, moving away from the policy of constructive ambiguity, which kept the the Chinese guessing. Or does he say, as he did to Joe Rogan in the election campaign, why are we protecting all these people who stole our US chip technology?
Right. That made Taiwanese faces blanche when they heard that. Because it's quite possible in a transactional frame of mind that Trump will say, OK, I'll do a deal with China. What does China really want from Trump other than its markets? It wants its hands off Taiwan.
And if America stands away from Taiwan, it'll be so much easier for the Chinese, the People's Liberation Army, to try and invade the island and take it over, which is a very difficult and costly exercise, More difficult arguably than than invading Ukraine because it's an island with a very high coastline. And the Taiwanese are very motivated to fight back. Like the, like the Ukrainians. They have, you know, quite a good army. You know, they can take out Chinese ships coming their way,
etcetera, etcetera. It would be a very, very costly thing to do. And Xi Jinping doesn't trust the People's Liberation Army to do it well enough to do it relatively bloodlessly. But that is his big ticket item. And if Donald Trump is part of a trade deal, since even just gives the Chinese the green light, that makes them think that he may just stand to one side because he doesn't give a damn about principles of democracy and freedom.
You know, that's irrelevant. It's about hemispheric power. Then Taiwan is in big trouble. And that is where we then get into a an incredibly nervous situation for Asia and possibly for all of us if he suddenly changes his mind and says, well, actually, I know you've started to invade Taiwan or you've got a military blockade going on. But actually I do want to protect them, either because I need their microchips or because I I respect what they do. I respect them as a democracy.
We don't know. So this is a major point of friction that they may try and sort out in their meeting in South Korea, but they may actually just create more trouble for further down the line. Well, we'll all be watching very closely when these two leaders meet tomorrow. It could have massive ramifications for the world. That's all we've got time for
this week on Trump WORLD. I'm Anish Kristana here in Washington, DC. I'm Matt Fry in London, goodbye from the two of us and I hope you enjoyed it. See you next week. See you next week.