One year ago at the Munich Security Conference, U.S. Vice President J.D. Vance stunned Europe’s leaders with a public scolding that scarred the continent into thinking about a future without Washington’s embrace. On the latest episode of FP Live, I spoke with a group of leaders on the main stage at this year’s Munich summit to check the pulse of the trans-Atlantic relationship. Our session was titled “Tariff-fying Times”—an obvious play on the White House’s economic coercion—and guests included World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala, German Vice Chancellor Lars Klingbeil, Finnish President Alexander Stubb, and U.S. Sen. Thom Tillis.

Subscribers can watch the full conversation on the video box atop this page or download the free FP Live podcast. What follows here is a condensed and lightly edited transcript.

One year ago at the Munich Security Conference, U.S. Vice President J.D. Vance stunned Europe’s leaders with a public scolding that scarred the continent into thinking about a future without Washington’s embrace. On the latest episode of FP Live, I spoke with a group of leaders on the main stage at this year’s Munich summit to check the pulse of the trans-Atlantic relationship. Our session was titled “Tariff-fying Times”—an obvious play on the White House’s economic coercion—and guests included World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala, German Vice Chancellor Lars Klingbeil, Finnish President Alexander Stubb, and U.S. Sen. Thom Tillis.

Subscribers can watch the full conversation on the video box atop this page or download the free FP Live podcast. What follows here is a condensed and lightly edited transcript.

Ravi Agrawal: Director-General Okonjo-Iweala, we’re now in year two of U.S. President Donald Trump’s second term. This time last year, the word you kept using was “chill.” You were telling us to wait and see what happens when it comes to tariffs. Well, now a year has passed, and we have some data. We know what’s happened. You’ve begun to sound a lot more concerned about the state of affairs.

Ngozi Okonjo-Iweala: When I said “chill,” it wasn’t that I wasn’t concerned. I was very concerned. But I meant that reacting quickly to these announcements without thinking through what kind of approach you need to have was not the best way to go. If you start a tariff war, can you carry it through? Would it be better to have dialogue? So that’s why I said “chill.”

RA: So take us to 2026 now. How concerned are you?

NOI: Oh, I’m still concerned. We’ve got a situation in which the U.S. average weighted tariffs have now gone from about 2.6 to about 18 percent in announced tariffs, according to our numbers. The actual applied tariffs are closer to 14 percent. That’s still a big leap in protective measures.

I will always say I may not agree with the United States’ unilateral actions or approach to dealing with the issues, but I do agree with a lot of their criticisms of the system. The system has not evolved and has not been quick to respond to the changing world. We may not like the action, but we must take the signal that we need to reform many of the things with the world trading system. This is where we are now.

I want to make a second point—and I know people don’t like to hear this—but in spite of the massive disruption of the system and the undermining of the global trade rules, the system is proving resilient. I will keep saying it: 72 percent of the world’s goods trade is still on WTO terms. Battered, bruised, but not broken. Those are my words. The system is still largely functioning. So, partly, this explains my calm, chill nerves.

I’ll end by saying that I am very proud of my members, because they didn’t descend into tit-for-tat with the United States. If they’d done that, the world would be much worse off than we are now.

RA: Vice Chancellor Klingbeil, about an hour ago we all heard Chancellor Friedrich Merz say that the international order is over. That sounds so different from what we’ve just heard from the director-general.

Lars Klingbeil: First of all, Chancellor Merz gave a very powerful and very good speech. He was orienting the whole Munich Security Conference, and he analyzed that the world order, as we know, is over.

He was very clear that Europe has to work very hard, that we are an attractive and also very........

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