MARY LOUISE KELLY, HOST:
President Trump's tariffs and rhetoric have spurred some U.S. allies to shift trade away from the United States and to boost trade with America's biggest competitor, China. This month, leaders of Canada and the United Kingdom both paid high-profile visits to Beijing. Those visits drew ire from Washington. We're joined now by NPR London correspondent Lauren Frayer and NPR international affairs correspondent Jackie Northam, who covers Canada. Hi to you both.
LAUREN FRAYER, BYLINE: Hi there.
JACKIE NORTHAM, BYLINE: Hi.
KELLY: Lauren, you kick us off. British Prime Minister Keir Starmer's visit to China - what was the purpose?
FRAYER: He's thawing relations. I mean, this is the first trip to China by any U.K. prime minister in eight years. Starmer arrived today in Beijing, brought a planeload of CEOs with him, mostly from British banks and tech companies. But he's also brought the head of the Table Tennis England association and the Royal Shakespeare Company.
KELLY: Soft power.
FRAYER: So a little bit of soft - exactly, soft power, but it's mostly business. I mean, amid tariffs and trade wars with the world's largest economy - that's America - Starmer's trying to boost trade with the second largest economy, and that's China. Here's what he said when he landed in Beijing today.
(SOUNDBITE OF ARCHIVED RECORDING)
PRIME MINISTER KEIR STARMER: We are resolute about being outward-looking, about taking opportunities, building relationships, having confidence globally and always being absolutely focused on our national interest. And it is in our national interest to engage with China.
FRAYER: Now, not everyone in - here in the U.K. actually agrees with that. There are questions about China's human rights record, surveillance, controversy over plans for a big Chinese mega-embassy here in London. Starmer also, during this trip, may be sort of looking over his shoulder at President Trump because President Trump often sees any overtures like this toward China as zero-sum, as possibly threatening or harmful to the U.S., as Canada's prime minister recently found out.
KELLY: Well, exactly. Jackie, jump in. We saw President Trump's irritation with the prime minister of Canada, Mark Carney, on full display last week at Davos. Trump was scolding him, using his first name from the lectern. How does Carney's trip to China this month fit into that?
NORTHAM: Oh, look, I mean, you know, Carney's Beijing trip was a big deal for Canada. You know, there were serious tensions between the countries for about a decade. But the two sides were able to remove trade barriers on Chinese electric vehicles and Canadian canola oil and other agricultural products. Now, initially Trump said, if Canada can get a deal with China, it should do it. But then he reversed that and warned Carney he'd slap 100% tariffs on all Canadian goods and products if a trade deal with China went ahead, adding that China would eat Canada alive, devour it.
KELLY: Devour it. I mean, could China eat Canada alive?
NORTHAM: Likely not. You know, look, Carney is a former Goldman Sachs guy and was head of the central banks in both Canada and the U.K. and likely has no illusions about what he's dealing with or what's involved in dealing with Beijing. But China is Canada's second largest trading partner, and Carney said he'll continue seeking opportunities with the country while keeping guardrails around the relationship.
KELLY: I mean, Canada's economy is, of course, heavily dependent on trade with the U.S., its neighbor to the south. I know you've been reporting on Carney's efforts to diversify that economy. Tell me more about what he's doing.
NORTHAM: Sure. Carney's strategy is to create a new string of economic and defensive alliances with other middle powers - you know, like the U.K., Australia, Malaysia - because he knows that Trump will use tariffs as economic coercion. Carney laid out this strategy in Davos last week at a meeting of the World Economic Forum. And remember, Davos was supposed to be all about Trump and his threat to seize Greenland. But Carney's speech there also made global headlines, and in it, he said that rules-based international order has been ruptured, and that survival for middle powers - such as Canada and such as the U.K. - means banding together to better protect themselves against economic powerhouses. Here's Carney here.
(SOUNDBITE OF ARCHIVED RECORDING)
PRIME MINISTER MARK CARNEY: The middle powers must act together because if we're not at the table, we're on the menu.
KELLY: Lot of concern, Jackie, about Canada getting eaten, being on the menu. What is Carney doing about it?
NORTHAM: Well, he's - you know, he has been on this whirlwind of visits to drum up business for Canada. You know, a lot through Southeast Asia and other parts of Asia. And he has secured 12 trade and security deals in six months. He's due to head to India in March, and then after that, a raft of other countries this year in search of more deals.
FRAYER: And if I can just jump in here, India - world's most populous country, one of the fastest-growing economies in consumer markets - is also playing a really big role in this new multipolar world that Carney spoke about in Davos, you know? And yesterday, the EU signed a big trade deal with India. They called it the mother of all deals. European Council President Antonio Costa stood in Delhi and spoke about the, quote, "global order being fundamentally reshaped (ph)." So it is not just China that U.S. allies are looking at as they diversify economic and even security relationships away from Washington.
KELLY: And, Lauren, for the U.K. particularly, what is Prime Minister Starmer doing to avoid similar tariff threats from Trump if Britain, say, does a deal with China?
FRAYER: Well, Mary Louise, as you know - you were here covering some of Trump's visits to the U.K. - he came twice this past year.
KELLY: Yeah.
FRAYER: In one of those, sealed a trade deal with the United Kingdom, and the U.K. saw that as a success because it exempts some British exports from some U.S. tariffs, or at least lowers the rate. So the U.K. feels protected in some sense from those tariffs. But while Carney has sort of declared a rupture of the old world order, Costa is talking about, you know, the world order being fundamentally reshaped, Starmer has been much more muted. He practices what some call appeasement with Trump. You know, they talk on the phone often. Trump came twice to the U.K. last year. Starmer hugs him, smiles, tries not to contradict him, even though he does look a little uncomfortable sometimes with some of the things that Trump has said standing next to him.
I spoke to Mujtaba Rahman. He's the managing director for Europe at the Eurasia Group. It's a risk analysis firm. And he describes how Downing Street sees this.
MUJTABA RAHMAN: The bilateral relationship between Trump and Starmer is a good one, and so, given some of the other strategic goals where the U.K. is very involved - Ukraine, NATO - I think there is a desire to retain that influence with the Trump administration. Carney, more decisive, but I think Starmer is still of the view that there's more of a balance to be had.
FRAYER: And the question is how long that balance is feasible, possible and makes sense in British national interest.
KELLY: And, Jackie, just a reality check from you on Canada. The U.S. is still Canada's number one trading partner. We're hearing from Carney he wants to shift, he wants to diversify. Can he pull it off?
NORTHAM: Well, you're right. I mean, two-way trade with the U.S. last year came in at about $1 trillion, so it is massive. I spoke with Jamie Tronnes, and she's executive director of the Center for North American Prosperity and Security, and that's a Canadian think tank. And she says it's impossible for Canada to make any sort of significant dent in replacing, you know, Canada's relationship with the U.S. But she says that the country does have its own strength.
JAMIE TRONNES: One of the things that I see here is a strategy in Carney's thinking that, as a competitor for new investment in the Western Hemisphere, Canada is a stable, friendly country that can provide certainty, which is exactly what foreign direct investors want to hear.
NORTHAM: And, Mary Louise, Tronnes says the hope is, by the time Trump leaves office, those countries will have gained a stable foothold in Canada for investment.
KELLY: That's NPR international correspondents Jackie Northam and Lauren Frayer. Thanks to you both.
NORTHAM: Many thanks.
FRAYER: Thank you.
(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.
NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
