Trump’s trade representative publicly calls out president’s ignorance on trade deals in incident that reportedly left Trump ’embarrassed’

US President Donald Trump with Trade Representative Robert Lighthizer.

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US President Donald Trump with Trade Representative Robert Lighthizer.
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Reuters/Kevin Lamarque

  • Robert Lighthizer, the man in charge of leading US trade negotiations with China, has publicly clashed with President Donald Trump over the most likely form that a trade agreement with Beijing will take.
  • Trump and Lighthizer clashed during a press conference at the White House on Friday, with the pair disagreeing on the definition of a memorandum of understanding.
  • A memorandum of understanding generally sets out the requirements and responsibilities of two parties entering contract negotiations and is among the first steps to establish a legally binding contract.
  • Video shows the pair discussing the meaning of such an agreement for about two minutes in the Oval Office.
  • The president admonished Lighthizer over the clash, according to Bloomberg, which cited sources saying he had been “embarrassed” by the trade representative’s public challenge.

Robert Lighthizer, the man in charge of leading US trade negotiations with China, has publicly clashed with President Donald Trump over the most likely form that a trade agreement with Beijing will take.

Late Sunday, a video of Trump talking to reporters at the White House on Friday began circulating on social media, showing the president and Lighthizer, the US trade representative, clashing over the definition of a memorandum of understanding, a key document generally created during the negotiation of a contract.

You can see the full exchange below:

After the clash, Trump privately vented that Lighthizer had contradicted him in public, saying the incident had left him embarrassed, according to a report from Bloomberg, citing two anonymous sources.

Bloomberg also reported that Trump was growing increasingly frustrated with Lighthizer, angry over the stock-market plunge late last year in which US stocks saw their worst December since the Great Depression almost 90 years ago.

The frustration is reportedly mutual, with Bloomberg adding that Lighthizer “has been growing irritated with Trump’s interventions.”

Trump’s confusion over the meaning of an MOU

Asked by a reporter whether a memorandum of understanding – which sets out the requirements and responsibilities of two parties entering contract negotiations – would be a “long-term deal,” Trump replied by saying that such agreements “don’t mean anything.”

“I think the MOU is going to very short term,” he said.

“We expect to go into it,” he continued. “I don’t like MOUs because they don’t mean anything. You’re better off just going into a document. I was never a fan an MOU.”

He was then interrupted by Lighthizer, however, who attempted to describe the legal meaning of the term. “An MOU is a contract,” he said. “It’s the way trade agreements are generally used. People refer to it like a term sheet. It’s not a term sheet – it’s an actual contract between two parties. A memorandum of understanding is a binding agreement between two people, and that’s what we’re talking about.”

Trump then shot back, saying: “By the way, I disagree, I think that a memorandum of understanding is not a contract to the extent that we want.”

He continued: “We’re doing a memorandum of understanding that will be put into a final contract, I assume, but to me the final contract is really the thing, Bob – and I think you mean that too – that means something.”

Lighthizer eventually suggested that the team would do away with the term altogether to prevent confusion. They would from then on, Lighthizer said, call the MOU a “trade agreement.”

“Good, I like that much better,” Trump replied.

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The clash took place just two days before Trump said his administration would delay an increase of tariffs on Chinese goods amid what he described as progress in talks to end the trade war between the world’s two largest economies.

The delay, announced less than a week before the deadline, was greeted with delight in financial markets, with stocks in Asia witnessing huge gains Monday. China’s benchmark index, the Shanghai Composite, saw its biggest single-day rally since 2015, jumping close to 6%.