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US President Donald Trump signed an executive order on Thursday, changing “mutual” tariffs in dozens of countries, with renewed obligations ranging from 10% to 41%.
In a phone interview with NBC News after the order, Trump said he would be open to a more persuasive offer, but said it was “too late” to avoid the tariffs set for other countries to kick next week.
“That doesn’t mean someone won’t come together in four weeks. We say we can do some sort of deal,” he said.
The latest tariff rate will begin on August 7th, White House officials told CNBC-TV18 via email.
“This should not be read as an extension, but should give (US) customs and border protection and give them ample time to implement these (customer duties),” the official added.
Trump said Wednesday in a post on True Society that will remain due for the August 1 reboot of tariffs.
“The first deadline for August is the first deadline for August. It’s strong and will not be extended. It’s a big day for America!!!” he wrote.
Among the countries facing the steepest “mutual” tariffs, Syria has the highest percentage at 41%. Exports from Laos and Myanmar to the US face a 40% obligation. Switzerland and South Africa face 39% and 30% tariffs, respectively.
For some Asian countries that have not confirmed trade agreements with the US, the latest executive order provided some relief with a lower obligation. The new tariff rate for imports from Thailand will be reduced from 36% to 19%, while the tariff rate in Malaysia will be reduced from the previously set 24% rate to 19%.
Shipments from Taiwan face 20% tariffs and are lower than the previously set 32% rate.
According to the White House, all products believed to have been introduced to circumvent applicable obligations will be subject to an additional 40% tariff.
The order said countries not listed in the latest orders will face an additional 10% obligation. The updated directive will amend tariffs imposed on a previous executive order issued in April.
According to the executive order, approaching a trade and security agreement with the United States or approaching a trade and security agreement with the United States will be subject to the revised fee until those agreements are concluded.
The executive order also confirmed new tariff charges agreed with trading partners, including the European Union, Japan, South Korea, the Philippines and Indonesia.
Former US deputy representative of trade representative Wendy Cutler also noted that countries with trade obstacles with the US have also suffered from high tariffs.
“What appears to be missing from the executive order is whether existing or new rules of origin will be issued or negotiated. This is important in light of the 40% shipping fee currently applied outside of Vietnam,” Cutler added.
The ongoing uncertainty regarding future sector tariffs and potential tariff increases will be particularly concerning, Cutler said, if the Trump administration believes the country is not implementing the terms agreed to in “good faith”;
Stephen Olson, a senior visiting fellow at the Iseas-Yusof Ishak Institute and a former US trade negotiator, said, “Don’t assume this is the end of the story…Don’t assume that more transactions and further increases in tariffs are almost certain.”
“A country that wants to do business with the US will face dramatic high tariffs, even if he signed himself, that could increase even further at the president’s whims of neglect on trade rules and agreements,” Olson added.
Trump also raised his plan to raise tariffs on exports from Canada from 25% to 35%, from 25% to 35%, except for goods covered by the US-Mexico-Canada free trade agreement he signed during his first term.
In early April, Trump announced that the US would impose a comprehensive tariff rate of 10% almost worldwide, and individual obligations of up to 50% in dozens of countries.
A few days later, Trump suspended the higher tariff rate for 90 days. This has been seen restarting on July 9th. He signed an executive order delaying the date until August 1st, the day when new tariff fees kick in, claiming there is no plan to extend that deadline.
Towards the August 1 deadline, Trump has sent letters to more than 20 world leaders who outline new tariff charges for exports to the US
Most of these new tariff rates were close to the level that Trump first set on April 2 using a formula criticized by economists.
On Monday, Trump came to the idea of increasing baseline tariff rates to about 15% or 20% on imports from countries that have not negotiated separate trade agreements with the United States.
Asian markets have largely declined following South Korea’s latest announcement Kospi Indexes exceed 3% during Japan Nikkei 225 A decrease of 0.66%. In Australia, the benchmark for the S&P/ASX 200 fell by 0.76%.
Tariffs on exports from China face an August 12 deadline after Beijing’s ceasefire with the US, but have not been affected by the latest directive. Both sides have positively called Stockholm’s recent US-China trade talks, but the agreement has not been finalized.
“As the dust settles, China will have the opportunity to pick up the mantle and grab it, perhaps in fact, rhetorically, as a leader in rules-based trade,” said Olson of the Iseasof Ishak Institute.
China could “correctly recognize the transshipment clause directed at its profits and weigh its response in ongoing trade talks with the US, he added.
– CNBC’s Victor Loh and Kevin Breuninger contributed to this story.
