President Donald Trump set a 25 percent tax on goods imported from Japan and South Korea on Monday, and announced new tariff rates on a dozen other nations which would go into effect on August 1.
The US president shared these notices by posting letters on his Truth Social social media platform and addressed them to the leaders of the various countries. The letters warned the 14 countries in question to not retaliate by increasing their own import taxes, or else the Trump administration would further increase tariffs.
“If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 25 percent that we charge,” Trump wrote in the letters to Japanese Prime Minister Shigeru Ishiba and South Korean President Lee Jae-myung.
Imports from Myanmar and Laos would be taxed at 40 percent, Cambodia and Thailand at 36 percent, Serbia and Bangladesh at 35 percent, Indonesia at 32 percent, South Africa and Bosnia and Herzegovina at 30 percent and Kazakhstan, Malaysia and Tunisia at 25 percent. Trump placed the word “only” before revealing the rate in his letters to the foreign leaders, implying that he was being generous with his tariffs.
Trump tariffs: Full list of countries
1) Japan 25%
2) South Korea 25%
3) South Africa 30%
4) Kazakhstan 25%
5) Malaysia 25%
6) Laos 40%
7) Myanmar 40%
8) Tunisia 25%
9) Bosnia and Herzegovina 30%
10) Indonesia 32%
11) Bangladesh 35%
12) Serbia 35%
13) Cambodia 36%
14) Thailand 36%
The letters were not the final word from Trump on tariffs, so much as another episode in a global economic drama in which he has placed himself at the center. His moves have raised fears that economic growth would slow to a trickle, if not make the US and other nations more vulnerable to a recession. But Trump is confident that tariffs are necessary to bring back domestic manufacturing and fund the tax cuts he signed into law last Friday.
He mixed his sense of aggression with a willingness to still negotiate, signaling the likelihood that the drama and uncertainty would continue and that few things are ever final with Trump.
Trade talks have yet to deliver several deals White House press secretary Karoline Leavitt said that Trump was by setting the rates himself creating “tailor-made trade plans for each and every country on this planet and that's what this administration continues to be focused on.” Following a now well-worn pattern, Trump plans to continue sharing the letters sent to his counterparts on social media and then mail them the documents, an stark departure from the more formal practices of all his predecessors when negotiating trade agreements.
The letters are not agreed-to settlements but Trump's own choice on rates, a sign that the closed-door talks with foreign delegations failed to produce satisfactory results for either side.
Trump has declared an economic emergency to unilaterally impose the taxes, suggesting they are remedies for past trade deficits even though many U.S. consumers have come to value autos, electronics and other goods from Japan and South Korea. The constitution grants Congress the power to levy tariffs under normal circumstances, though tariffs can also result from executive branch investigations regarding national security risks.
It's unclear what he gains strategically against China — another stated reason for the tariffs — by challenging two crucial partners in Asia, Japan and South Korea, that could counter China's economic heft.
“These tariffs may be modified, upward or downward, depending on our relationship with your Country,” Trump wrote in both letters.
Because the new tariff rates go into effect in roughly three weeks, Trump is setting up a period of possibly tempestuous talks among the US and its trade partners to reach new frameworks.
According to Trump's letters, autos would be tariffed separately at the standard 25 per cent worldwide, while steel and aluminum imports would be taxed on 50 per cent.
This is not the first time that Trump has tangled with Japan and South Korea on trade — and the new tariffs suggest his past deals made during his first term failed to deliver on his administration's own hype.
In 2018, during Trump's first term, his administration celebrated a revamped trade agreement with South Korea as a major win. And in 2019, Trump signed a limited agreement with Japan on agricultural products and digital trade that at the time he called a “huge victory for America's farmers, ranchers and growers.”
Trump has also said on social media that countries aligned with the policy goals of BRICS, an organization composed of Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran and the United Arab Emirates, would face additional tariffs of 10 percent.
(With AP inputs)
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