From Los Angeles to the World: A Consular Dialogue on Trade Futures
VX News presents excerpted highlights from a recent VerdeXchange Conference panel, “Supply Chains Going Forward,” hosted by the World Trade Center Los Angeles (WTC-LA), and moderated by Stephen Cheung, President & CEO of LAEDC and WTC-LA. The panel featured Andrea Sasse, Consul General of Germany; Kenko Sone, Consul General of Japan; Wendy Wagner, Head of Canada’s International Trade Group at Gowling WLG; and Okko-Pekka Salmimies, Consul General of Finland. As Sasse and Sone highlight, uncertainty—not just policy—emerges as a driving concern for markets and manufacturers. Wagner highlights the challenges of navigating tariff complexity, particularly for Canadian firms, while Salmimies emphasizes the need for international rules that support clean and digital transitions. Turning to the feasibility of reshoring and the geopolitical realities that make rapid supply chain shifts difficult, panelists voice clear support for cooperation among like-minded nations and reaffirm their commitment to multilateral frameworks and trade agreements. Closing on a hopeful note, the panelists call for renewed global goodwill and a recommitment to rules-based trade. As Cheung remarks, diplomacy can take many forms—from orange chicken to Shohei Ohtani—but building bridges through cultural and economic exchange remains essential in navigating this new era of global commerce.
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Stephen Cheung: We know that throughout today, we’ve addressed many international issues that have been changing since January, and every single day, we're looking at: how do we make sure that this region—Los Angeles—that's so dependent on international trade and international partnerships, can move forward?
Let's start with a straightforward question. On April 2, the President of the United States announced several different tariffs and international policies, and I don't have to go through them—but with that said, this is going to affect your countries, your regions, as well as Los Angeles, California, and the United States. Beginning with Andrea, how do you anticipate that these tariffs and policies will start affecting our supply chain and the trade relationship between your country and the United States?
Andrea Sasse: I think the most important thing to mention is that, regarding trade questions, it's the EU that is the partner to the US. I’m speaking today on behalf of the EU. Normally, we would have the Presidency here…however, at the moment, it’s more about the uncertainty that is affecting the markets. As we’ve seen today, there are a lot of swings in the financial markets. We just talked about this on the sidelines, Kenko and I. That applies to financial markets here in the US, in Japan, and also in Europe—particularly in Germany.
Germany, as you know, is a very export-oriented country and has been for a long time. As one of the member states of the European Union, we are heavily affected by these tariffs. Again, the crucial factor right now is uncertainty. Companies, as well as trading partners, are trying to stay on top of their game, follow developments, and make sense of the situation.
Kenko Sone: For context—I’ve been working in our Foreign Ministry for more than 35 years. I was once a negotiator at the WTO. What we have been doing traditionally is reducing tariffs—not increasing them. With that mindset, I admit I have a bit of bias when it comes to tariffs. Maybe I’m speaking slightly beyond the Japanese government’s official position, but generally, we try to avoid tariffs.
Once President Trump took office, we saw that he consistently emphasized tariffs—saying things like “tariffs are good.” That contrasted with my understanding of tariffs, and since then, our government has been in constant communication with the U.S. government, expressing concern about the escalation of tariffs. We’ve emphasized that the U.S. should not take unilateral tariff measures. Despite that, the U.S. ultimately decided to raise tariffs on almost all countries. For Japan, this means a 24% tariff on non-farm products. Our government was disappointed by this announcement. We believe this will hurt the global economy and go against international trade rules, including those under the WTO and our bilateral trade agreement. We’re concerned that these measures may be inconsistent with our agreements.
We’re continuing to reach out to the U.S. government at all levels, urging a reconsideration of this decision. Just this morning, our Prime Minister had a phone call with President Trump. The Prime Minister emphasized that Japan has been the largest foreign investor in the United States for five consecutive years and expressed strong concerns that these measures could weaken Japanese companies investing in the U.S., which could affect future investment.
We urged a reconsideration of these measures. While we didn’t receive a specific response, we agreed to continue consultations. These discussions remain candid and, hopefully, constructive. But so far, there has not been any real progress. Our government is also preparing to support companies impacted by these tariff increases. We’re still in the early stages, and each company is assessing how these tariffs affect their products and trade flows. Overall, we’re very, very concerned about the situation.
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Stephen Cheung: Wendy—even though the April 2 announcement wasn’t directly about Canada, some of this started earlier. Taking everything into account, how does it affect Canada?
Wendy Wagner: We got off relatively lucky on April 2, compared to what had happened earlier in the year. Canada was subject to tariffs as early as March 4, and then we retaliated. When it comes to uncertainty, it has been a day-to-day shift in the tariff landscape between the U.S. and Canada.
The U.S. implemented tariffs on March 4, but by March 7—just a few days later—they were scaled back to apply only to products that didn’t qualify under the USMCA, the free trade agreement. That sounds like a good outcome, but it created a lot of confusion since people don’t deal with tariffs every day; they didn’t fully understand the impact. About 60% of products from Canada may qualify under the USMCA—but many businesses hadn’t gone through the analysis to confirm that because it’s complicated. Especially with products that have many components and foreign inputs, it’s not easy to determine. We try to impress upon our clients that you can’t just sign a statement of origin saying your product qualifies—it could be considered fraudulent if you haven’t done the analysis.
Despite the rollback, there was still a huge impact. On March 12, steel and aluminum tariffs were implemented—25% tariffs on those and derivative products. That’s especially significant for Canada, given the volume of trade in those sectors. Even though we weren't directly impacted by the April 2 tariffs, we saw auto and auto parts affected shortly after, having a huge impact on our economy. Canada retaliated in response. While it may sound a bit harsh, there was a small part of the Canadian public that felt validated when other countries started to face similar tariffs—and welcomed the support for our retaliatory measures. Beyond the technicalities of supply chains and tariff codes, there’s also been a strong emotional reaction in Canada that I think people don’t always appreciate.
A lot of goodwill has been lost. From a Canadian perspective, that’s significant. There’s a growing “Buy Canadian” movement. I know we’re not alone—similar sentiments are emerging in other countries too. The impact on tourism and travel has also been enormous. I have a home in Palm Springs, and just this past week, businesses have started to notice. There are “We love Canadians” signs popping up all over Palm Springs now—which is lovely to see.
Still, this feels like more than an economic dispute—it feels a little like a war, and that’s been the saddest thing for Canadian staff and citizens to experience.
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Stephen Cheung: As you're talking, one of the things you mentioned is uncertainty, right? I think the only certain thing is that there will be uncertainty in the coming month, and unfortunately—or maybe not—our President may have taken a page from one of the greatest TV talk show hosts: Oprah. “You get a tariff, you get a tariff, you get a tariff—everybody gets a tariff,” right? With that said, how is this affecting Finland?
Okko-Pekka Salmimies: I very much share the background Kenko mentioned—having worked extensively with trade policy. The EU has the mandate and jurisdiction for trade policy, but there are also significant behind-the-border issues that impact international trade. One area I’m particularly interested in is regulation—both in general and in specific forms, like tax breaks and subsidies.
Finnish companies here in the U.S. are very focused on the clean and digital transitions. We know that during the previous U.S. administration, there were strong incentive packages—like the IRA and IIJA. If California moves further in the direction of providing more support, the level playing field may tilt even more. I believe there may be opportunities for the state of California to address some of the concerns international businesses face behind the border.
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Stephen Cheung: Any other thoughts on California? Governor Newsom has made some statements about how California may counter some of these federal measures and strengthen international relationships. Are there any actions you may recommend to offset the impact?
Andrea Sasse: It’s really about outreach. Just last week, our ambassador met with Governor Newsom, and they talked extensively about the situation, as well as partnerships at the subnational level. California has always been very active in reaching out to international partners that share similar values and economic perspectives. Because California has been such a leader in renewable energy and zero-emission technologies, it’s a very natural partner for many of us.
Kenko Sone: Yes, I agree. Sharing common positions and concerns—and supporting international trade—is important. We’re currently gathering information from Japanese companies in California to understand the specific impacts they’re experiencing. Eventually, this will affect workers at those companies here in Southern California.
Once we collect that information, I want to share it with elected officials, because these trade measures aren’t helping the U.S. economy—they’re hurting it. It would be great if California could provide some financial support for companies affected by these trade impacts—not just foreign companies, but all companies experiencing harm. That might be one option. Of course, it’s not easy to implement, but at the very least, we can share concerns and work together—especially by connecting with people who have a shared view on trade.
Wendy Wagner: I think government procurement is an area where the state can make a difference. In Canada, the response hasn’t just been about retaliatory tariffs—there’s also been action at the provincial level around procurement. Some U.S. companies are now finding they can’t bid on certain contracts. If California made an effort to keep procurement markets open, that could pave the way for reciprocal access at the provincial level in Canada too.
Another area is services…green tech, knowledge, and engineering are service-based rather than about trading physical goods. That sector could be promoted more heavily since it's less impacted by tariffs. That said, sometimes services depend on goods—so the impact isn’t zero. Clients often ask us, “To what extent do these tariffs affect services?” Right now, services remain mostly untouched. I hope that continues and we don’t see a shift toward taxing services, but for now, that’s a promising space to explore.
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Stephen Cheung: Earlier, before this panel, we had a pitch session with international companies presenting their products. One company from Canada spoke about partnering with U.S. manufacturers, just in case a ‘Buy America' provision comes into play. The current administration seems focused on economic independence and reshoring industries, as there has been global discussion about the practicality of quickly reshoring manufacturing. Could you speak to how businesses or policymakers in your regions are responding to that shift? Are they taking steps to manufacture in the U.S.?
Kenko Sone: When our Prime Minister visited the United States in February for the summit meeting, he announced that Japan would work to increase its investment in the United States, bringing the total to 1 trillion U.S. dollars. We’ve already invested around $800 billion here, so we’re looking to add another $200 billion. That announcement came just before the new tariffs were introduced. We were already in the trend of increasing investment in the United States, but we’ve also been talking with Japanese business leaders, and the reality is that making new investments takes time…maybe three, four, even five years. It’s not easy to just shift supply chains or bring everything into the U.S. overnight. It takes years. Of course, we can’t predict the future, but in general, if it's economically viable, we’re ready to encourage Japanese companies to invest in the United States.
Andrea Sasse: I think it all comes down to the broader point that we live in a globalized world where supply chains and markets are deeply interconnected. Speaking from Germany’s experience, after Russia invaded Ukraine, we had to rapidly reduce our dependencies. It seemed almost impossible at first, and while we managed to do it, it came at a high cost. In the end, it was worth it, but it shows just how complex and painful that process can be.
As Kenko just said, you can't shift supply chains overnight. The U.S. knows this too, especially concerning China, where there are dependencies in critical areas like rare earths and minerals. You have to diversify your markets and sources, but that takes time. It’s not something you can change quickly—or in some cases, at all—because we live in a global market, unlike 100 years ago.
Okko-Pekka Salmimies: I can build on what I said earlier. We do believe that nearshoring and friendshoring will continue—and security concerns will play an even stronger role in shaping supply chains. At the same time, things are more complicated now than before. As Kenko and Andrea said, new investments are long-term decisions. We already have one EV investment from Finland in California that's been in the pipeline for a while—and I don’t think that’s going to change.
I haven’t seen any new investment proposals arise because of the current trade conflict, and yes, I’ll say it: I used to hesitate calling it a “trade war,” but what we’re seeing now in the news makes me more comfortable using that term. That said, I think California has an opportunity to consider the kind of international role it wants to play in the global supply chain landscape. We all learned from the pandemic and from intensifying geopolitical tensions that there’s no such thing as total economic decoupling. Our economies are deeply intertwined. It’s a good time to remember that 15 years ago, we had the TTIP discussions. 30 years ago, there were similar efforts for a transatlantic free marketplace.
Wendy Wagner: It varies company by company. It’s difficult for many Canadian firms, because their primary market—not just export market, but primary market overall—is the United States. For those businesses, onshoring is definitely under consideration. However, there are huge complications: tax issues, employment considerations, and the overall business environment. Maybe California does have an edge as an investment destination, but to your point, there's a cascade of other factors to think about.
If you build something here, will you still have access to the components you need? If everything must be sourced from the U.S. or be subject to high tariffs, that creates a very constrained and possibly unattractive environment for manufacturing. You have to think about those costs. There’s also concern about the broader investment climate, especially around repatriation of funds and what might happen next. That adds to the uncertainty. I almost hesitate to say it out loud, because I’m afraid someone might pick it up as the next big idea, but it’s a real concern. It all relates to the overall stability of the investment climate, and maybe that's something California can offer: stability in a turbulent environment.
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Stephen Cheung: Another potential disruptor, or maybe a tool to reshape things, is technology. We’ve seen innovations like digital supply chain management and automation. They might help—or maybe not. What are your thoughts on how technological innovation could enhance supply chain resiliency, particularly in light of the current trade policies?
Wendy Wagner: There’s going to need to be some really good technology in place to track whether a product has 20% U.S. content—so it won’t be subject to tariffs. That’s how these reciprocal tariffs are supposed to be applied. So I hope U.S. Customs and Border Protection has some excellent tech ready to go. If they don’t, then there’s a market opportunity for someone to build it. The level of complexity in how these tariffs are being applied is astounding. Right now, customs authorities just aren’t known for being at the forefront of innovation, so implementing this as intended will be a heavy lift.
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Stephen Cheung: As we deal with these trade policies, one of the saddest parts is the erosion of goodwill. International collaboration is being tested. That’s why this conference, VerdeXchange, is so important—it’s about environmental connection.
Many countries remain part of the Paris Climate Agreement, committed to sustainability goals. With the focus on reshoring and altering supply chains due to tariff policy, how can countries ensure that these changes still align with environmental goals and minimize environmental harm? As trade agreements help us reach sustainability goals, could stepping away have the opposite effect?
Okko-Pekka Salmimies: It’s worth noting that NAFTA was the first trade agreement to include an environmental clause—giving countries the possibility to restrict trade on environmental grounds. In the broader international trading system, there have been attempts to establish multilateral or plurilateral agreements, but so far, success has only been achieved at the regional or bilateral level.
It’s not just about the right to protect; the positive side matters too. That includes preferential market access for environmental goods and services, and for intellectual property related to environmental innovation. That’s critical, because protectionism doesn’t automatically lead to better environmental outcomes—I’d argue the opposite. If we restrict the flow of the best possible environmental goods and services, we’re harming. These issues still need to be addressed. If we’re talking about clean and digital transitions here, we need international rules on technology, regulatory harmonization—at least to a certain point, and these needs won’t just disappear. There will be a critical mass of countries who recognize that it’s not just important—it’s essential—to negotiate agreements that promote a level playing field and enable the free flow of the best environmental technologies.
Andrea Sasse: I think it’s a balancing act. Let me give you an example from Germany. Under our outgoing government, we introduced legislation to set standards for supply chains—requiring companies to ensure compliance with things like human rights and SDGs. It sparked a major debate in Germany. Many companies felt it placed a heavy burden on them—to have to trace their products, show where and how each part was produced, and justify those supply chains.
From my perspective, that debate hasn’t yet been fully resolved. But I share it to illustrate that there are real trade-offs. You have to strike a balance. On one hand, we need to uphold certain standards—they’re part of our democratic values and central to the SDGs. On the other hand, as Okko-Pekka just said, we can’t prevent companies from doing business. The challenge is finding that middle ground.
Kenko Sone: As Okko-Pekka mentioned earlier about environmental goods and services—I was one of the negotiators in the WTO environmental goods and services talks, and although those talks weren’t very successful at the time, we did make progress within APEC. There, we identified a list of environmental goods, and each country voluntarily agreed to reduce tariffs on those products.
Regardless of what’s happening with broader tariff policy, at least we’ve identified products that are good for both the economy and the environment. Continuing to promote trade in those goods and services would be beneficial.
Right now, Japan is actively promoting hydrogen technologies in this region. Those hydrogen technologies weren’t part of the original environmental goods list, but perhaps it’s time to expand that list to include them. If we’re ready to reduce tariffs again, these are the kinds of technologies we should be sharing.
When the U.S. withdrew from the Trans-Pacific Partnership under President Trump, many were concerned, but we worked to move it forward even without the United States. It’s really important to coordinate with like-minded countries and not give up. Goodwill can prevail. For example, we have a trade agreement with the EU that includes environmental chapters. We’re also active in the CPTPP, and we’re working in frameworks like the Quad. I don’t know if anyone from India is here today, but these are the types of collaborations where we can come together and do something positive for the environment.
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Stephen Cheung: Don’t give up on us yet—we’re still here fighting. As we wrap up the panel, I want to end on a hopeful note. I opened the session with a bit of levity because this is a heavy topic. There are real challenges. But let’s close by uplifting each other a bit. Looking ahead, what collaborative approaches can nations pursue to balance national interests with the shared benefits of globalization—something we’ve built together since the 1940s and 50s—so that we can work toward a more stable and equitable international trade environment?
Andrea Sasse: The EU is a great example. We have a single, integrated market that’s brought enormous benefits—growth, prosperity, and stability—since the EU was founded. It’s a real demonstration of how open, free trade without borders can succeed. So I believe the EU’s success speaks for itself.
Kenko Sone: Thank you. As I mentioned earlier, through agreements like the TPP and others, we’ve been working toward reducing tariffs and strengthening the rules-based international economic order. Also, President Trump met with the Dodgers this morning—so maybe sports can bring something positive. Go Dodgers!
Wendy Wagner: I think we need to redefine what’s considered in the national interest, especially when it comes to environmental goods and services. It is in a country’s best interest to procure the most effective environmental products at the lowest cost. Not to protect inefficient domestic industries at the expense of progress.
If we all adopted that mindset, we could go much further, but that requires a realignment in trade rules—like what counts as a permissible subsidy. Unfortunately, we seem to be moving in the opposite direction. Still, that’s the direction we should be headed. And even if not everyone stays the course, those who believe in it have to keep going.
Okko-Pekka Salmimies: Well, this is a conference about green tech, technology, investment, and policy. So I’ll say this: first, you need political will. Then you need both the stick and the carrot—enabling policies and, at times, mandatory regulation. You also need consumers and companies on your side. I look forward to hearing stronger voices from the U.S. business community—and from consumers as well. I’m a strong believer in democracy. I believe it will ultimately bring forth the best and most progressive ideas. Yes, at some point, when it comes to environmental protection, governments do need to step in and regulate. Maybe this isn’t the perfect way to do it, but I still believe political will and common sense will prevail.
Stephen Cheung: Thank you all so much for your thoughts and insights. As we close, I want to go back to this conference called VerdeXchange—and it’s about the exchange. I hope that these human-to-human interactions we’ve had today can help carry us through these difficult times.
It reminds me…some years ago, President Obama visited Japan and was part of what was called sushi diplomacy, using food and culture to bring people together. We kind of stole that idea. On a trade mission to Mexico, we brought one of our biggest exports—Panda Express. We opened over 200 locations across Mexico. I called it orange chicken diplomacy. Perhaps we should explore Shohei diplomacy, among other cultural ties to bring us together. That’s just one example, but we hope to do much more of this.
We’re going to get through this together.
