Washington: President Donald Trump has officially postponed the implementation of higher tariffs on imports into the US, while simultaneously issuing notices to 14 countries, including Japan and South Korea, detailing the specific levies they will face.
According to BBC, this decision follows a 90-day pause initiated by the White House on some of its most aggressive import taxes, which was set to expire this week. President Trump has reiterated the threat of a 25% tax on products entering the country from Japan and South Korea and has communicated through a series of letters to global leaders about the levies effective from 1 August.
Most of the tariff rates outlined in these communications resemble those announced in April when Trump made his “Liberation Day” declaration, threatening new taxes on goods from several countries. Trump shared these letters on social media, indicating that tariff rates might be adjusted “upward or downward, depending on our relationship with your country.”
Investment strategist Vasu Menon from OCBC bank noted that Trump’s actions might be part of a negotiating strategy rather than genuine tariff threats, offering some optimism to investors. Meanwhile, Trump maintains that tariffs are necessary to protect American businesses from foreign competition and to boost domestic manufacturing and employment.
However, economists have warned that these tariffs could lead to higher prices in the US and reduce trade. The US stock market reflected these concerns, with major indices slipping and Toyota’s US-listed shares dropping by 4%. Japan, the fifth-largest supplier of imports to the US last year, and South Korea, which ranks among the top 10, face significant tariff increases.
President Trump has also announced plans for tariffs on goods from Myanmar, Laos, Thailand, Cambodia, Serbia, Bangladesh, Indonesia, South Africa, Malaysia, and Tunisia, with rates ranging from 25% to 40%. In response, Japanese Prime Minister Shigeru Ishiba expressed regret over the US’s tariff decisions and pledged continued negotiations with the US to reach a mutually beneficial agreement.
South Korea plans to use the extended deadline to intensify talks with the US, and Thailand’s finance minister remains optimistic about reaching a favorable tariff agreement. White House press secretary Karoline Leavitt suggested that more letters might follow, while disputing claims that shifting tariff deadlines could weaken Trump’s negotiating position.
Treasury Secretary Scott Bessent anticipated a busy period ahead, noting an influx of new offers and proposals from various countries eager to negotiate. Trump’s initial tariff announcements in April, described as “reciprocal,” were meant to counteract foreign trade practices perceived as unfair to US exports.
The US has already reached agreements with the UK and Vietnam, as well as a partial deal with China, though these have resulted in higher tariffs compared to pre-Trump levels. A deal with India is reportedly close, though unresolved issues persist across these negotiations. President Trump has also threatened the EU with a 50% tax if a deal is not reached, and Japan could face a 30% to 35% tariff if no agreement is made by the deadline.