US President Donald Trump and members of his delegation attend lunch during a meeting at the Istana in Singapore on June 11 2018. Picture: REUTERS/JONATHAN ERNST
US President Donald Trump and members of his delegation attend lunch during a meeting at the Istana in Singapore on June 11 2018. Picture: REUTERS/JONATHAN ERNST

Singapore — US President Donald Trump fired off a volley of tweets on Monday venting anger on North Atlantic Treaty Organisation (Nato) allies, the EU and Canadian Prime Minister Justin Trudeau in the wake of a divisive Group of Seven (G-7) meeting at the weekend.

Having left the G7 summit in Canada early, Trump’s announcement that he was backing out of the joint communiqué torpedoed what appeared to be a fragile consensus on the trade dispute between Washington and its top allies.

"Fair trade is now to be called fool trade if it is not reciprocal," tweeted Trump, who flew from Canada to Singapore for a meeting with North Korean leader Kim Jong-un.

"Sorry, we cannot let our friends, or enemies, take advantage of us on trade anymore. We must put the American worker first!"

The communiqué, which had appeared to have papered over the cracks that surfaced so uncharacteristically at the G7, said the leaders of the US, Canada, Britain, France, Italy, Germany and Japan were agreed on the need for "free, fair, and mutually beneficial trade" and the importance of fighting protectionism.

"We strive to reduce tariff barriers, non-tariff barriers and subsidies," the statement said, which came despite Washington appearing intent on taking more punitive steps on trade.

It is unclear if Trump’s focus on getting tough with trade partners, and solving the North Korean nuclear issue will have some influence on voters in the mid-term congressional elections in November.

While foreign policy issues like North Korea do not usually have much bearing on the polls, Trump’s extraordinary outburst on Monday against Nato allies, the EU and Canada appeared aimed at striking a chord with voters who support his "America First" agenda.

"Not fair to the people of America! $800 billion trade deficit," he said. "Why should I, as president of the United State, allow countries to continue to make massive trade surpluses, as they have for decades, while our farmers, workers & taxpayers have such a big and unfair price to pay?"

The White House did not immediately respond to a request for comment on why Trump had focused his tweets on Canada and the EU over trade disputes and on Nato partners over defence costs and not on his talks with Kim set for Tuesday.

Asked whether allies had any reason to worry about Trump’s commitment to any deal he reaches with North Korea following his abrupt withdrawal from the G-7 communiqué, one US official appeared to brush aside the notion, saying other countries had got used to how the president operated internationally.

‘Long shadow’

The prospect that Trump could be moving towards an even greater protectionist trade policy is likely to chill financial markets worried about tit-for-tit escalation that could lead to a full-blown global trade war.

"Business confidence, and subsequently capital spending, is at risk if this tension continues through the summer," said Tai Hui, JP Morgan Asset Management chief market strategist for Asia-Pacific. "This could cast a long shadow over global growth, which has rebounded in recent weeks after a soft start to the year."

Nevertheless, markets were relatively calm on Monday ahead of the European open, although the Canadian dollar slipped a little in early trade.

Trump also lambasted fellow members of the Nato for paying disproportionately less than the US to maintain the Western alliance.

"The US pays close to the entire cost of Nato — protecting many of these same countries that rip us off on trade (they pay only a fraction of the cost — and laugh!)," he tweeted. "The European Union had a $151 billion surplus — should pay much more for military!" "Germany pays 1% (slowly) of GDP towards NATO, while we pay 4% of a much larger GDP. Does anybody believe that makes sense?" "We protect Europe (which is good) at great financial loss, and then get unfairly clobbered on trade. Change is coming!"

By ordering his representatives to back out of the communiqué, Trump appeared to be asserting his oft-stated aim of upsetting the status quo, whether by pulling out of the global climate accord or the international nuclear deal with Iran or threats to scrap the 1994 North American Free Trade Agreement (Nafta) between the US, Canada and Mexico.

On Monday, Trump also renewed attacks on Trudeau, who had hosted the G-7 meeting in Quebec.

"Justin acts hurt when called out!" the US president said in his latest tweet. On Saturday, he called the Canadian prime minister "very dishonest and weak".

Place in heaven

White House economic adviser Larry Kudlow accused Trudeau of betraying Trump with "polarising" statements on trade policy that risked making the US leader look weak ahead of the historic summit with Kim.

"[Trudeau] really kind of stabbed us in the back," Kudlow, the director of the National Economic Council who had accompanied Trump to Canada, said on CNN’s State of the Union.

Trade adviser Peter Navarro told Fox News Sunday that "there is a special place in hell for any leader that engages in bad faith diplomacy" with Trump.

Trudeau, in Quebec City for bilateral meetings with non-G7 leaders after the summit, did not comment as he arrived.

But he got direct personal support from some European leaders.

British Prime Minister Theresa May "is fully supportive" of Trudeau and his leadership, a senior UK government source said, while European council president Donald Tusk tweeted: "There is a special place in heaven for @JustinTrudeau."