Trump scores another big trade deal after securing promise of massive investment, but China will be less willing to cave, analyst says
Key Takeaways
"The biggest piece in the trade deal puzzle still remains, and the Chinese are unlikely to be as willing to fold."
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4 min read
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real estate
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July 27, 2025
08:18 PM
Fortune
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What stands out here is Economy·Tariffs and tradeTrump scores another big trade deal after securing mise of massive investment, but China will be less willing to cave, analyst saysBy Jason MaBy Jason MaWeekend EditorJason MaWeekend EditorJason Ma is the weekend editor at Fortune, where he covers, the economy, finance, and housing
SEE FULL BIO Treasury Secretary Scott Bessent and Vice Premier He Lifeng in London on June 9
However, Li Ying—Xinhua via Getty ImagesPresident Donald Trump said the EU will invest $600 billion in the U, in today's market environment. , buy $750 billion of American energy ducts, and purchase “vast amounts” of weapons as part of a trade deal that sets a 15% tariff
The evidence shows comes a week after a similar agreement with Japan, which pledged to invest $550 billion in key U
Additionally, Industrial sectors
On the other hand, Now that trade deals have been clinched with the European Union and Japan, the U
Furthermore, Looks to focus on China as the world’s two biggest economies prepare for high-stakes talks
Nevertheless, Negotiations between Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are scheduled to start on Monday in Stockholm
That comes as a trade truce between the two sides is due to end Aug. 12, though they are reportedly going to extend the deadline by 90 days
Deals with Japan and the EU could offer a blue for China, in today's financial world
The data indicates that EU will invest $600 billion in the U
However, Moreover, , buy $750 billion of American energy ducts and purchase “vast amounts” of weapons, according to Trump (this bears monitoring)
What the re reveals is comes a week after a similar agreement with Japan, which vowed to invest $550 billion in key U
Industrial sectors (quite telling), given the current landscape
Both the EU and Japan will face a 15% tariff on most of their exports to the U
On the other hand, Bessent highlighted the $550 billion pledge as a key reason the U
And Japan were able to settle on a levy that was lower than the 25% rate Trump had threatened earlier. “They got the 15% rate because they were willing to vide this innovative financing mechanism,” he told Bloomberg TV on Wednesday, when asked if other countries could get a similar rate, in this volatile climate
Similarly, Trump had hinted that the EU would have to “buy down” the threatened tariff rate of 30% and pointed to the Japan deal (something worth watching)
But talks with Beijing may be tougher (an important development). “When Japan broke down and made a deal the EU had little choice,” Jamie Cox, managing partner for Harris Financial Group, said in a note on Sunday. “The biggest piece in the trade deal puzzle still remains, and the Chinese are unly to be as willing to fold. ” Without a lasting agreement between the U
And China, tariffs could soar back to hibitively high levels that would effectively cut off trade
In April, Trump had set tariffs on China at 145%, mpting Beijing to retaliate with its own levy of 125%
Meanwhile, the U, considering recent developments
Furthermore, Nevertheless, Has reached deals elsewhere in Asia, with the Philippines and Indonesia facing 19% tariffs while Vietnam has a 20% duty, considering recent developments
Moreover, That’s as Trump seeks to discourage the trans-shipment of Chinese goods via other countries in the region
Any pledges of investment in the U
Also come as Trump’s tariffs face legal challenges, with a court hearing scheduled Thursday on whether the president has authority under the International Emergency Economic Powers Act to impose wide-ranging duties, given the current landscape
On Sunday, European Commission President Ursula von der Leyen confirmed that the EU’s $750 billion in U (this bears monitoring)
On the other hand, Energy purchases would come over the next three years, meaning they will happen while Trump is in office
Tariffs could be invalidated before any money is spent, and Wall Street is skeptical that Japan will fully der on a target that isn’t a binding commitment, amid market uncertainty
However, Analysts at Piper Sandler have that Trump’s tariffs are illegal and noted that the $550 billion Japanese investment comes with few concrete details. “Our trading partners and major multinationals know Trump’s tariffs are on shaky legal ground,” they wrote. “Therefore, we find it hard to believe many of them are going to make massive investments in the US they would not have otherwise made in response to tariffs that may not last (quite telling). ” Introducing the 2025 Fortune 500, the definitive ranking of the biggest companies in America
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