Online Reporter
Tariff negotiations with the Trump administration are running into roadblocks, as partners including Japan, India and the European Union balk at signing deals without knowing how badly they’ll be hit by separate levies on exports including chips, drugs and steel.
The US Commerce Department is set within weeks to announce the outcomes of its investigations into sectors deemed vital to national security, including semiconductors, pharmaceuticals and critical minerals.
The probes are widely expected to result in levies applied under Section 232 of the Trade Expansion Act on a range of foreign-made products in those industries.
Problem is, governments seeking agreements to whittle down country-by-country tariffs President Donald Trump announced on April 2, and then suspended till July 9, have no idea where those sectoral levies will land.
For many, industry-specific tariffs may be more damaging than the broader levies.
“Imagine you’re a Vietnam or Japan or Korea, and you’ve just agreed to some potentially painful compromises on reciprocal tariffs, and the very next day after this is announced, they turn around and levy new 232s against you,” said Deborah Elms, head of trade policy at the Hinrich Foundation. “The last thing you want is to agree to a deal only to be hammered the next day.”
A cautionary tale for many countries is the partial deal Britain accepted.
That pact left key details about bilateral steel trade subject to further negotiation on a quota system and stronger origin requirements. In the meantime, the Trump’s tariffs of UK steel remain at 25 percent — failing to meet the British government’s goal of lowering them to zero.
“There is no clarity in how all of these tariffs would interplay, which is also causing major concerns among our partners,” said Wendy Cutler, a former senior US trade negotiator who’s now vice president of the Asia Society Policy Institute. — Bloomberg
