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WASHINGTON – US tariff negotiations with key trading partners have shifted into high gear as economies race to avoid steeper tariffs before an Aug 1 deadline.
Many of these tariff hikes were part of a package first announced in April, under which dozens of economies were due to face higher levies – up from a 10 per cent level – over their trade surpluses with the US.
The twice-postponed deadline for levies to take effect
is now Aug 1
.
But Washington has expanded its list of targets coming up against these tariffs while announcing agreements with the European Union (EU), Britain, Vietnam, Japan, Indonesia and the Philippines.
A deal with the EU unveiled on July 27 sees a
15 per cent tariff imposed
on European exports to the US, down from the 30 per cent that Mr Trump had earlier threatened.
Where do other US trade talks stand?
Seoul is racing to reach a deal with Washington, as
Tokyo’s success in landing an agreement
has “amped up the pressure for South Korea”, a government source told AFP.
Local media reported that
Seoul was preparing to propose more than US$100 billion (S$128 billion) in investment
as part of a broader agreement, with expected participation by major companies such as Samsung and Hyundai Motor. The South Korean government did not confirm this.
But South Korean officials have outlined proposals to deepen collaboration in sectors such as shipbuilding, semiconductors and batteries.
National Security Adviser Wi Sung-lac told reporters that the two countries are in “the final and most crucial phase of negotiations” to avert Mr Trump’s proposed 25 per cent tariff.
Indian Commerce Minister Piyush Goyal told Bloomberg Television on July 24 that he was optimistic his country could reach an agreement with the US to avert Washington’s 26 per cent tariff threat.
Mr Goyal insisted there were no sticking points in the US-India relationship or trade talks, and clarified that immigration rules – including those around H-1B visas for skilled workers – had not come up in negotiations.
Despite Mr Goyal’s remarks, local media reported the prospects of an interim deal before Aug 1 had dimmed.
Taiwanese Premier Cho Jung-tai said on July 24 that officials are “working hard” on negotiations, amid worries that an unfavourable tariff level could hit the self-ruled island’s economy.
Vice-President Hsiao Bi-khim said Taipei’s negotiating team was “working almost 24 hours a day to achieve trade balance and Taiwan’s industrial interests, and even to further deepen cooperation”.
Although Canada and Mexico were spared from Mr Trump’s “reciprocal” tariffs announced in April, goods from both countries entering the US generally face a separate 25 per cent levy if they fall outside a North American trade pact.
This figure stands to jump to 30 per cent for Mexico come Aug 1, while the level for
Canada was set at 35 per cent.
Mexican President Claudia Sheinbaum said her administration was “doing everything” possible to avert the tariffs and that she would speak to Mr Trump if necessary to try to reach a pact.
Mr Trump told reporters on July 25 that there was no deal with Canada so far.
Brazil is girding for a virtual trade embargo on its planes, grains and other goods if Mr Trump’s threatened
50 per cent tariff on its exports
takes effect on Aug 1.
The US runs a trade surplus with Latin America’s biggest economy, which was not originally expected to face a steeper tariff under Mr Trump’s “reciprocal” levy plan.
Mr Trump has not attempted to hide the political motivation in targeting Brazil, citing a judicial “witch-hunt” against his right-wing ally, former president Jair Bolsonaro, when he unveiled the tariff rate.
The political nature of the spat makes a last-minute deal appear less likely. AFP
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