TWN Info Service on WTO and Trade Issues (Aug25/10)
13 August 2025
Third World Network

Need for Global South Round of negotiations to counter US tariffs

Geneva, 12 August (D Ravi Kanth) -- The developing countries need to launch a new Global South Round of trade negotiations to counter the seemingly predatory "Trump Round" that appears to rest on an extortionary framework of imperial preferences, said several officials from developing countries. 

With developing countries drowned in US President Donald Trump’s unilateral so-called Fair and Reciprocal Plan of tariffs, serious communications seem to be underway between key developing countries on how to arrive at a new round of negotiations among the developing nations, said people familiar with the developments.

Trump’s FRP seems to be based on what the historian Adam Tooze called "a tariff number, a lump sum investment and a promise to buy some of America’s few remaining charismatic mega-commodities, things like oil, gas, weapons, chips ... you offer him all three, ideally whilst he holds forth in the ballroom of one [of] his golf resorts”. Pointing to the US-EU agreement, Tooze, writing in his Chartbook newsletter, said such deals make no sense, as “the EU has no means of directing $600 billion in investment to anywhere. Brussels does not run European energy imports and there is no conceivable future in which Europe will buy $750 billion in fossil fuels from the United States.”

According to Tooze, “Right now the only possible tactic is to take things one day at a time. There is a naked giant on the loose who thinks the rest of the world is waiting for him to dish out their just deserts. It is time to face some stark choices!”

Against this backdrop, developing countries in various configurations are mulling over the possible narrative that they could offer to counter the Trump Round's seemingly extortive form of imperial preferences, said people familiar with the developments.

Global South needs just world 

Chinese President Xi Jinping has said that Beijing is ready to work with Brazil to set an example of unity and self-reliance among major countries in the Global South, and jointly build a more just world and a more sustainable planet, according to a 12 August news report in China's Global Times.

In an exchange of views, Xi discussed with Brazilian President Luiz Inacio Lula da Silva building a China-Brazil community with a shared future and said the alignment of the two countries' development strategies was getting off to a good start and making smooth progress.

The Chinese president is reported to have said that “China backs the Brazilian people in defending their national sovereignty and supports Brazil in safeguarding its legitimate rights and interests, urging all countries to unite in resolutely fighting against unilateralism and protectionism.”

Brazil has been hit with a 50% US tariff, with a 10% tariff based on the FRP and 40% on extraneous political considerations.

Xi praised the BRICS (Brazil, Russia, India, China, South Africa plus six new members) mechanism as a key platform for building consensus in the Global South, according to the Global Times report.

He is understood to have “called on Global South countries to jointly safeguard international fairness and justice, defend the basic norms governing international relations, and protect the legitimate rights and interests of developing countries.”

He emphasized that “China and Brazil should continue to address global challenges, ensure the success of the upcoming UN Climate Change Conference in the Brazilian city of Belem, and promote the 'Friends of Peace' group's role in facilitating the political settlement of the Ukraine crisis.”

In response, Lula said Brasilia “attaches great importance to its relations with China, and looks forward to strengthening cooperation with China, deepening strategic alignment and promoting greater development of bilateral ties.”

He briefed Xi on the recent situation of Brazil's ties with the US, as well as Brazil's unwavering principled stance on safeguarding its own sovereignty.

He said his country “stands ready to enhance communication and coordination with China in multilateral mechanisms such as BRICS, oppose unilateral bullying practices and safeguard the common interests of all countries."

Last week, the Brazilian president had called on Indian Prime Minister Narendra Modi and said he would speak with representatives of other BRICS countries about the US tariffs on their products. "I will try to discuss with them how each country is affected by the situation and what the implications are, so that we can make a decision," Lula said, according to an Agency Brazil report, noting that BRICS includes several members of the G20, the group that brings together the world's 20 largest economies.

Lula has also spoken with Russian President Vladimir Putin, according to news reports. 

In July, Trump warned that countries which side with the policies of the BRICS alliance that go against US interests will be hit with an extra 10% tariff. "Any country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% tariff. There will be no exceptions to this policy," he wrote on social media.

In response to Trump's remarks, Mao Ning, a spokesperson for China's Ministry of Foreign Affairs, said on 7 July that BRICS is an important platform for cooperation among emerging markets and developing countries. "It advocates openness, inclusiveness and win-win cooperation. It is not a bloc for confrontation, nor does it target any country."

On Monday, Trump extended the deadline for imposing high tariffs on China for another 90 days.

Global South must come together

In an interview on 10 August, Richard Kozul-Wright, former Director of the Globalization and Development Strategies Division in the United Nations Conference on Trade and Development (UNCTAD), rubbished the Trump administration’s FRP, suggesting that “tariffs have come down tremendously, particularly in the developing world over the course of the last 40 years under pressure at the WTO [World Trade Organization] and of course under pressure bilaterally and through the Washington-based institutions the IMF and the World Bank.”

According to Kozul-Wright, “developing countries are now more open today than they've ever been historically,” and “American corporations have done extremely well out of the system that they themselves were responsible for designing ... to a large extent.”

He suggested “the Trump Round will not end neoliberalism in any sense, but it's the end of the fiction of a rules-based international order.” “The advanced economies always were rigging the rules in their favour as they preached 'do as I say, not as I do' to the bulk of the developing world.”

“And we've been here before, you know, Nixon – I mean, this idea that Trump is sui generis, that he's come out of nowhere, it's not a very accurate ... account of Americans' role as the hegemon,” Kozul-Wright said. The US “did it in 1971 with Nixon when it cut the gold link with the dollar. It did it again at the end of the 1970s with the Volcker shot, which was in many respects more important to the future direction of the world economy than this. These are all unilateral decisions that the US has always taken to make sure that the system works in its favour.”

According to Kozul-Wright, South-South cooperation offers an avenue to overcome the uncertainty caused by Trump. “There's no doubt about that. You know, South-South trade accounts now for something like 40-45% of world trade.”

“China as the manufacturing factory for the world ... offers a new, I think a unique, opportunity for other developing countries to become part of that story,” he said, adding that “India's role in that is more complicated, always has been, but there are real opportunities that need to be explored.”

Importantly, unlike in the 1970s when developing countries were pursuing a New International Economic Order, “the South has already created a kind of skeletal South-South infrastructure. We have institutions like the New Development Bank, the Contingency Reserve Arrangement, all kinds of new regional models that have emerged over the last 10-15 years that weren't there at the time of the New International Economic Order.”

“So I think developing countries can come up with a proper set of South-South rules,” Kozul-Wright said.

While South-South cooperation has often been at a rhetorical level, the developing countries “need to rethink the set of principles and rules for real South-South cooperation and integration,” said Kozul-Wright.