Trump Administration Live Updates: President Announces New Tariffs of 25% on Goods From Japan and S. Korea

New York Times

5 days ago

President Trump is set to rekindle economic pressure on America's trading partners this week, as a deadline for making trade deals elapses and the administration begins notifying countries of the tariffs they'll face on exports to the United States.
For 90 days, the administration has been trying to reach trade pacts with dozens of countries in an attempt to lower economic barriers to U.S. exports. In April, the president imposed stiff global tariffs on nearly every trading partner but paused most of those levies until July 9 to try and win concessions.
So far, the United States has reached only two preliminary trade deals, with Britain and with Vietnam, which are scant on details and leave much to be worked out.
More such limited trade deals could be announced in the coming days, including an initial trade framework with India. Countries that have so far agreed to trade deals, even preliminary handshake agreements, have qualified for lower tariff rates than what Mr. Trump threatened in April.
Other countries that have not reached agreements are expected to face sharply higher tariffs, although the president and his advisers have recently implied that the tariffs may not go into effect until Aug. 1, rather than on July 9.
Still, with tariffs threatening to strain diplomatic relations and bring some global commerce to a halt, a delay of a few weeks may not to do much to soothe many foreign governments. It could also further unsettle financial markets, which revolted when Mr. Trump initially announced his global tariffs, a meltdown that prompted Mr. Trump to institute the 90-day delay.
Mr. Trump said late Sunday that his administration would begin sending out letters on Monday at noon Eastern to trading partners dictating the tariff rates their products would face.
He also threatened an additional 10 percent tariff against countries aligned with 'the anti-American policies of BRICS,' using an acronym for a group of countries that includes Brazil, Russia, India, China and South Africa.
Whether Mr. Trump's pugilistic approach forces countries to agree to quick trade deals or incites retaliation and trade wars will be a critical test for the president's extraordinarily aggressive and unpredictable approach to international trade.
Since taking office Mr. Trump has raised tariffs to levels not seen in a century, before abruptly pausing many of them. Mr. Trump's supporters argue that his tariff threats have created leverage to forge new agreements and secure better terms for American businesses and the economy. Critics say his tactics have disrupted global trade flows and financial markets and stripped businesses of the certainty they need to plan, resulting in higher prices, less investment and slower economic growth for the country.
The president's announcement of steep global tariffs in April threw stock and bond markets into turmoil — in part because the levies were incredibly punishing for many of the nation's biggest trading partners. Mr. Trump was persuaded to pause his tariffs for a period of 90 days, which calmed markets, and convinced some investors and analysts that, although the president sees tariff threats as a valuable source of leverage, he would stop short of imposing tariffs at a level that would disrupt markets or cause severe harm to the economy.
But in recent months, the president himself has repeatedly called that idea into question. In May, he threatened to impose a 50 percent flat tariff on the European Union, saying the bloc was not offering enough concessions. He then paused those levies until July 9.
Mr. Trump continues to profess a belief in the value of tariffs as a way to balance out international trade relationships and finally make the world more fair for U.S. businesses, which he says have long been ripped off by foreigners.
While Mr. Trump's advisers praise him as a consummate deal maker, the president has often seemed more interested in maintaining high tariffs on foreign goods than in striking trade deals that would lower economic barriers for American companies and encourage more international business flows.
Speaking to reporters on Air Force One on July 4, the president said he had quickly decided what tariff rate to apply to foreign countries.
'I've been looking at it for many years,' he said. 'Frankly, I think it's ridiculous that countries were able to get away with so much.'
The government's trade negotiators have also been overwhelmed as they try to simultaneously hammer out trade deals with multiple partners. Dozens of countries, ranging from South Korea and Malaysia to Lesotho and Switzerland, have reached out to the United States in recent months to try to reach an agreement that would prevent the Trump administration from applying hefty tariffs to their exports.
'People are just extremely stretched,' said Wendy Cutler, a vice president of the Asia Society Policy Institute and a former U.S. trade negotiator.
Some of those negotiations have proceeded swiftly, propelled by common interests and good relations. Vietnam and the United Kingdom, for example, have agreed to open their markets to U.S. agriculture, buy more Boeing airplanes and cut down on certain ties to China, among other changes.
Last week, Mr. Trump's threats against Canada also appeared to produce rapid results. After Mr. Trump said in late June that he would suspend trade talks with Canada over its digital services tax on American tech companies, the Canadian government abruptly scrapped the measure.
'Deals with Vietnam and other countries may very well show that there's method to the tariff madness,' said Michael Wessel, a longtime trade adviser. 'The devil, of course, is in the details, but it's well past time to rebalance the playing field,' he added.
Still, many other businesses say the tariff threats have been extremely disruptive and there appears to be little evidence in the U.S. economic data yet that tariffs are broadly helping manufacturers. Instead, the uncertainty created by Mr. Trump's tariff threats appears to be slowing investment and hiring, potentially backfiring on the president's plans to boost U.S. factory activity.
Spending on construction of factories in the United States has fallen since Mr. Trump was elected in November, and the number of Americans working in factories has slumped since last year. In recent months, U.S. manufacturers have shed roughly thousands of jobs, though growth in health care and other sectors has eclipsed those losses and resulted in strong employment data.
It remains to be seen whether the tariffs Mr. Trump may reimpose in the coming weeks will again set off a drop in the stock markets or pushback from industry. But the president shows little sign of backing away from using his favorite trade tool to try to cow foreign countries and businesses into concessions.
The legitimacy of the president's global tariffs has been called into question by U.S. courts, and some of his tariffs could be declared illegal this fall. Still, administration officials have said they have other legal authorities they could turn to in that event to pursue similar policies.
Even for those countries that have struck deals with the Trump administration, tariffs remain extraordinarily high, creating a tax on both American consumers and importing businesses that economists expect to drag on economic activity.
Exports from the United Kingdom remain subject to a 10 percent universal tariff, which the Trump administration shows no signs of dropping, even for America's closest allies.
The preliminary trade deal with Vietnam lowers tariffs on some Vietnamese products to 20 percent rather than the 46 percent Mr. Trump threatened in April. But many business groups that rely on imports from Vietnam, such as the footwear industry, say that 20 percent rate will raise costs for American consumers.
It is also not clear what the deal with Vietnam actually entails. The president announced the agreement with Vietnam on social media last week, but no text or other fact sheets have yet been released by the governments.
Other major trading partners, like the European Union and Japan, have proven more challenging to negotiate with. Like other governments, the European Union and Japan remain wary of additional tariffs the president has imposed or is still threatening on their critical sectors, like automobiles, pharmaceuticals and steel. They have also been reluctant to open their markets to American agricultural exports that could undercut their own farmers.
If the Trump administration does not strike deals with major trading partners, it could end up stoking trade wars instead. Foreign governments including the European Union have prepared retaliatory packages of tariffs on U.S. exports that they are threatening to impose if hit by further American levies.
John Raines, Head of North America, economics and country risk at S&P Global Market Intelligence, said in a note that many trading partners that were currently negotiating might see their tariffs paused, but that there were many 'caveats to bear in mind.'
Reaching a provisional trade deal could increase trade policy certainty at least temporarily for a country. But it does not necessarily mean tariffs will be low, as some countries face tariffs much higher than the universal 10 percent levy set by Mr. Trump. Even countries that reach deals may still face future tariffs that Mr. Trump intends to impose on critical sectors like electronics and pharmaceuticals, Mr. Raines said.
But he said that Mr. Trump could also quickly back down again after imposing higher tariffs, as he has on previous occasions.
'Countries or territories threatened with higher tariffs may experience such tariffs lasting only days or weeks, as the administration may back down as a result of adverse market conditions, or if it perceives that negotiations have progressed positively following the initiation of the higher tariff threat,' he wrote.
Tyler Pager contributed reporting.