A number of new tariffs will go into effect on most of the US’s trading partners in a week, according to President Donald Trump’s administration.
Trump’s import duties, which were scheduled to start on August 1 and were delayed the majority, will start on August 7.
Trump sees the tariffs as a powerful economic tool that will encourage domestic manufacturing and help US exporters become more competitive.
Different levies will be imposed on nations, starting from 15% on Japan and the European Union to 39% on Switzerland, despite the situation still being dynamic.
How have different markets and nations responded to the news:
China
China has warned that US protectionism “fails the interests of all parties” ().
According to Guo Jiakun, a spokesman for the Chinese government, “the Chinese side’s opposition to tariffs has been consistent and unwavering.”
In a tariff- or trade-war, he continued, “There is no winner.”
Beijing and Washington are negotiating a tariffs deal despite not having a permanent agreement. Following a mutually agreed pause until August 12, a 30% combined tariff will be applied. That came after an imports tariff of 145 percent had already been implemented.
Taiwan
William Lai Ching-te, president of Taiwan, described Trump’s 20 percent tariff as “temporary” and “with the possibility of further reductions if an agreement is reached.”
The US president had threatened to impose a 32 percent tax and possible duties on the island’s massive semiconductor shipments.
Japan
Beginning August 7, a 15 percent tariff agreed last week between Japan and Washington will be in effect. It will replace the threatened 25 percent tariff.
Prime Minister Shigeru Ishiba reaffirmed his commitment to the US on Friday, urging the country to implement the agreement, including lowering the tariffs on cars and auto parts.
However, the Bank of Japan (BOJ) warned that Japanese companies’ profits are likely to decline this year as a result of US tariffs, which could cause them to lower their capital expenditure plans.
According to the BOJ, automakers have absorbed the rising costs of the tariffs rather than passing them on to US consumers, as evidenced by a 20% drop in export prices since April.
This suggests that Japanese automakers are avoiding price increases that could cause sales volumes to decline while also allowing for worsening profitability, according to the BOJ.
Malaysia
The trade ministry of Malaysia has declared that the rate, which is currently at a threatened 25%, was acceptable without sacrificing any of the “red line” items.
Thailand
The reduction in tariffs, according to Thailand’s finance minister, will help its struggling economy overcome global challenges.
According to Pichai Chunhavajira, “it helps maintain Thailand’s competitiveness on the global stage, boosts investor confidence, opens the door to economic growth, increased income, and new opportunities.”
Cambodia
Cambodia’s crucial garments sector, which is its biggest economic driver and source of about a million manufacturing jobs, saw a major boost as the US cut its tariff rate on Friday from 36 percent to 49 percent, a major boost.
According to me, if the US kept its industry at 49 or 36 percent, then it would collapse, according to Cambodia’s deputy prime minister and top trade negotiator Sun Chanthol.
European Union
Following a framework agreement between the EU and the US, Maros Sefcovic, the EU’s trade chief, stated that the bloc’s exporters now stand to gain from a “more competitive position,” but that “the work continues.
In a post on social media platform X, Sefcovic wrote that “the new US tariffs reflect the first outcomes of the EU-US agreement, particularly the 15 percent all-inclusive tariff cap.”
He continued, “This increases trust in the transatlantic economy as well as stability for businesses.”
Switzerland
Despite its “very constructive position,” Switzerland regrets “greatly that it was hit with 39 percent – up from the threatened 31 percent”.
The wealthy Alpine nation appeared to be caught off guard by the more than twice the EU’s 15% levy.
In the US, Roche and Novartis, two of the country’s largest pharmaceutical companies, have recently announced major spending plans. Switzerland is currently in the sixth place in terms of direct investment.
Sri Lanka
Sri Lanka rejoigned that it would face a 20% hit, a significant decrease from the original 44 percent, and hoped for even more.
Harshana Suriyapperuma, a senior official in the finance ministry, told reporters, “We are happy that our competitiveness in exports to the US has been preserved.”
Bangladesh
Bangladesh’s trade agreement reduced Trump’s initial proposal to a 20% tariff on exports to the US.
The interim government of the nation, led by Muhammad Yunus, hailed it as a “decisive diplomatic victory.”
Pakistan
On Thursday, Pakistan and the US agreed to a 19% tariff rate.
The Pakistani Finance Ministry stated in a statement that “this agreement marks the beginning of a new era of economic collaboration, particularly in the fields of energy, mines and minerals, IT, cryptocurrency, and other sectors.”
India
Trump stated on Wednesday that Indian goods would be subject to a 25% US tariff starting August 1, a level that was previously anticipated.
Trump stated on social media that the country would also be subject to an “unspecified” penalty for purchasing Russian weapons and energy.
The Indian government stated in a statement on Wednesday that it was “attaching the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs” and that it was “examining the implications of these new tariffs.”
South Africa
President Cyril Ramaphosa said on Friday that South Africa will negotiate after the US imposed 30% tariffs for the week to avoid paying the penalty and protect jobs.
Ramaphosa informed journalists that “intensive negotiations are now taking place.”
He said, “Our task is to negotiate with the United States as effectively and effectively as we can.” Really, our goal is to save jobs.
Canada
Trump announced on Thursday that US tariffs would increase from 25% to 35% on some Canadian goods.
After Prime Minister Mark Carney made the announcement to recognize a Palestinian state at the UN General Assembly in September, he had warned about the impact on trade for Canada.
There is no delay, and these begin on Friday, according to a White House fact sheet, unlike the new levies that are imposed on dozens of other countries.
Carney claimed that Trump’s decision disappointed his country.
Trump’s order also cited Canada’s “unreliable” action in halting the current flood of fentanyl and other illicit drugs as well as its “retaliation” against his actions.
Carney outlined Ottawa’s efforts to reduce fentanyl and improve border security. He said that Canada has been working diligently to further reduce these volumes, even though it imports only 1% of US fentanyl.
The vast majority of the products covered by the 2020 United States-Mexico-Canada Agreement will not be subject to the tariff rate.
Markets
Investors were concerned about the impact of the new US levies on numerous nations, and European stocks dropped to a three-week low.
After the tariff announcement, Asian shares were also anticipating the worst week since April.
Source: Aljazeera
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