The United States imposes new tariffs, ranging from 10% to 12.5%, on many trading partners. The measure was introduced, according to the White House, against countries accused of not having adequately combated forced labor practices in commercial chains with the United States. And it comes into force precisely at the expiration of the temporary 10% tariffs that Donald Trump had introduced for a period of 150 days after the cancellation of the previous ones at the beginning of February by the Supreme Court.
Products already subject to sector-specific duties will not be affected by this measure. The new duties go into effect at 12:01 a.m. Friday (Eastern Time, 6 a.m. in Italy).
60 countries affected
The measures, released by the Office of US Trade Representative Jamieson Greer, are aimed at 60 countries and replace the temporary global ones of 10%. The move is the result of a wide-ranging investigation which, according to the Financial Times, includes important trading partners of the United States such as Japan, South Korea, India and Canada, as well as the European Union and the United Kingdom. China and Brazil are also included in the survey.
Differentiated duties
The new measures affect more than 99% of American trade, according to Greer’s office. Countries deemed to have incomplete legislation will be subject to 10% tariffs on some of their exports to the United States. These include the European Union, Canada, India, the United Kingdom and Mexico. For around 40 other countries, including China, Japan, Switzerland and South Korea, the rate will rise to 12.5%. Energy and raw materials not produced in the United States should, however, remain excluded.
The vice president of the European Commission, Kaja Kallas, responded to the imposition of the new tariffs: “The US tariffs are a negative surprise after the EU has respected the trade agreements. The new tariffs on European products have no real basis”, she said, expressing doubts about the motivation linked to forced labor.
Goods already subject to specific national security tariffs, including steel, aluminum, automobiles and related components, will not be affected by the new provisions, which are based on a frequently used trade law provision – section 301 of the Trade Act of 1974 – that is considered more legally sound than the legal basis of the tariffs struck down by the Supreme Court. Furthermore, exemptions also apply to oil, gas and fertilizers, as well as other goods that the United States does not produce.
The “rewards” for those who combat forced labor
Countries that make progress in combating forced labor could see tariffs drop to 10%. As in the case of India, for example, “rewarded” with 10% after the approval of a law against forced labor which corrected the 12.5% initially foreseen. Currently, however, the United States does not believe that the countries surveyed adequately protect workers, regardless of the existence of relevant laws: findings destined to create a new legal storm.
According to many international observers, the Trump administration’s move actually has the aim of rebuilding the global tariff regime of the “Liberation Day” tycoon, demolished by the Supreme Court ruling. And it comes after a new wave of 50% tariffs on some Canadian goods and after the imposition of a 25% tariff on many Brazilian products. Jamieson Greer, the US trade representative, said the tariffs on forced labor would “restore equity in the global marketplace for American workers” and push US trading partners to “join the US in eliminating forced labor from global supply chains”.