World Peace Forum: Chinese vice president says tariff and trade wars will have "no winners"
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CNA
18 minutes ago
- CNA
Trump eyes simple tariff rates over complex talks, says letters going out Friday
WASHINGTON :President Donald Trump said Washington will start sending letters to countries on Friday specifying what tariff rates they will face on imports to the United States, a clear shift from earlier pledges to strike scores of individual deals. Acknowledging the complexity of negotiating with over 170 nations, Trump told reporters before departing for Iowa on Thursday that the letters will be sent to 10 countries at a time, laying out tariff rates such as 20 per cent to 30 per cent. "We have more than 170 countries, and how many deals can you make?" Trump said. "They're very much more complicated." The Republican president said he expected "a couple" more detailed agreements with other countries after Wednesday's announcement of a trade deal with Vietnam. However, he said he preferred to notify most other countries of a specific tariff rate, skipping detailed negotiations. Trump's comments underscored the challenges of completing trade agreements on everything from tariffs to non-tariff barriers such as bans on agricultural imports. Top Trump aides said in April they would work on 90 deals in 90 days, an ambitious goal that was met with skepticism from trade experts familiar with arduous and time-consuming trade deals of the past. Treasury Secretary Scott Bessent told Bloomberg Television that about 100 countries are likely to see a reciprocal tariff rate of 10 per cent and predicted a "flurry" of trade deals announced before a July 9 deadline when tariffs could rise sharply. If 10 per cent tariffs were given to 100 countries, that would be fewer than originally envisioned by the Trump administration. Its original reciprocal tariff list showed 123 jurisdictions that would be given a 10 per cent tariff rate - mostly small countries, along with some territories such as Australia's uninhabited Heard and McDonald Islands. Trump sent markets into a tailspin on April 2 with sweeping reciprocal tariff rates ranging from 10 per cent to 50 per cent, although he temporarily reduced the tariff rate for most countries to 10 per cent to allow time for negotiations through July 9. Many countries with an initial 10 per cent duty rate have not had any negotiations with the Trump administration, with the exception of Britain, which reached a deal in May to keep a 10 per cent rate and won preferential treatment for some sectors including autos and aircraft engines. Major trading partners now involved in negotiations were hit with much higher tariff rates, including 20 per cent for the European Union, 26 per cent for India and 24 per cent for Japan. Other countries that have not engaged in trade talks with the Trump administration face even higher reciprocal tariffs, including 50 per cent for the tiny mountain kingdom of Lesotho, 47 per cent for Madagascar and 36 per cent for Thailand. Trump on Wednesday announced an agreement with Vietnam that he said cuts U.S. tariffs on many Vietnamese goods to 20 per cent from his previously threatened 46 per cent. Many U.S. products would be allowed to enter Vietnam duty free.
Business Times
37 minutes ago
- Business Times
Trump wins broad economic policy shift as House passes tax bill
[WASHINGTON] President Donald Trump secured a sweeping shift in US domestic policy as the House passed a US$3.4 trillion fiscal package that cuts taxes, curtails spending on safety-net programmes and reversed much of Joe Biden's efforts to move the country toward a clean-energy economy. The 218-214 vote in the House Thursday sends the legislation to Trump, in time for a July 4 deadline he set. House leaders had to keep earlier procedural votes open for hours to convince a small band of holdouts to support the legislation. The president leveraged his sway over the Republican party through threats of primary challenges, White House lobbying sessions and golf-course socialising to overcome resistance from both conservative hardliners concerned about the measure's debt impact and swing-state GOP moderates worried about the scale of Medicaid cuts. In the end, only two Republicans, Thomas Massie of Kentucky and Brian Fitzpatrick of Pennsylvania, joined with Democrats to oppose the bill. Earlier in the week, Vice-President JD Vance had to break a tie vote to get the massive tax and spending package through the Senate. Trump's victory followed an all-night vote wrangling session in the House, beset by numerous delays as the president railed on social media against Republican lawmakers who declined to quickly back the legislation. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up House Republican Leader Steve Scalise credited Trump with breaking the logjam, impressing upon holdouts overnight that there would be no further changes to the bill. 'When the president is done negotiating, the game is up — it's time to vote,' he said. House Ways and Means Chairman Jason Smith extolled the bill for its populist appeal, calling it legislation for 'people who don't have lobbyists' in Washington. 'It's about restoring sanity in a town that's lost it, cutting waste and reining in reckless spending,' Smith said. 'It demands that if you're able to work, you should. It stops asking working families to foot the bill for Washington's bad decisions.' Democrats, in contrast, say the bill will strip health care for millions of people who depend on Medicaid to fund tax cuts for the wealthy. Political clash The fierce partisan battle to shape public perceptions of the measure is likely to intensify in the coming months, with Democrats hoping a voter backlash will return them to power in next year's midterm elections. They portray the president's signature legislation as a Robin Hood-in-reverse scheme to take safety-net benefits away from the poor to pay for tax cuts skewed toward the rich. 'This legislation will end Medicaid as we know it,' House Democratic Leader Hakeem Jeffries said Thursday during a marathon speech right before bill passage. 'Rural hospitals will close, nursing homes will close.' It will 'provide tax breaks for the wealthy, well-off, well-connected,' he added, during a speech that ran for more than eight hours and broke a record for the longest House floor address in history. Trump and his Republican allies are counting on the measure's US$4.5 trillion in tax cuts to bolster economic growth. The legislation delays many of the spending reductions while front-loading levy reductions with populist appeal, including a permanent increase in the child tax credit and temporary four-year tax breaks for the elderly and for tip and overtime pay that Trump promised in his presidential campaign. Early reviews Democrats start with an advantage in polls. A Pew Research survey last month found 49 per cent of Americans opposed the bill, while just 29 per cent supported it. Some 21 per cent weren't sure. The nonpartisan Congressional Budget Office projects the legislation will add US$3.4 trillion to US deficits over the next decade, adding to investors' concerns about the US fiscal trajectory. DoubleLine Capital's Jeffrey Gundlach, one of the most high-profile names in the bond market, warned last month that the federal debt burden has become 'untenable' and the US dollar has dropped about 9 per cent in part on those concerns this year against major world currencies. But a US$5 trillion increase in the US debt limit in the package eliminates the risk of a market-rattling payment default the Treasury had forecast could come as soon as mid-August without congressional action. The final legislation is more costly than an earlier version the House passed primarily because Senate Republicans decided to make permanent a series of business tax breaks covering interest expensing, research and development spending and bonus depreciation of certain assets, including machinery and factories. The tax breaks had been temporary in the earlier version. Medicaid cuts The Senate also imposed deeper cuts in Medicaid health insurance for the poor and disabled, reducing spending on the programme by nearly US$1 trillion over the next decade, according to the CBO. That includes restraints on federal funding matches for state Medicaid programmes, new work requirements for able-bodied recipients without children under 14 years old, and new cost-sharing requirements for beneficiaries who received coverage through President Barack Obama's Affordable Care Act. The package also cuts spending for federal food stamps and college student loans. Most clean-energy tax breaks passed under Biden are phased out and a popular US$7,500 consumer tax credit for electric vehicles is eliminated for purchases made after Sept 30. The core of the bill is an extension of 2017 Trump tax cuts for individuals and pass-through businesses that were set to expire at the end of 2025. It also provides new resources for Trump's crackdown on illegal immigration and for military spending including the president's 'Golden Dome' missile defense plan. A group of House Republicans from high-tax states such as New York, New Jersey and California won a temporary increase in the limit on the state and local tax deduction to US$40,000. After five years, the cap will snap back to the current US$10,000 limit originally imposed under Trump's 2017 tax law. BLOOMBERG
Business Times
an hour ago
- Business Times
Oil prices ease on US tariff uncertainty ahead of expected Opec+ output boost
[NEW YORK] Oil prices fell slightly on Thursday as investors worried that US tariffs could slow energy demand ahead of an expected supply boost by major crude producers. Brent crude futures settled 31 cents, or 0.45 per cent, lower to US$68.80 a barrel. US West Texas Intermediate crude fell 45 cents, or 0.67 per cent, to US$67 in thin trade on the eve of the Independence Day holiday. President Donald Trump's 90-day pause on implementation of higher US tariffs ends on July 9, and several large trading partners have yet to clinch trade deals, including the European Union and Japan. Oil traders are worried about the impact on the economy and fuel demand. A preliminary trade deal between the US and Vietnam boosted prices on Wednesday, but overall tariff uncertainty looms large. Also weighing on prices, Opec+ is expected to agree to raise output by 411,000 barrels per day at its policy meeting this weekend. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Also, a private-sector survey showed service activity in China - the world's biggest oil importer - expanded in June at its slowest pace in nine months as demand weakened and new export orders declined. In the US, a surprise build in crude inventories also highlighted demand concerns in the world's biggest crude consumer. The US Energy Information Administration said on Wednesday that domestic crude inventories rose by 3.8 million barrels to 419 million barrels last week. Analysts in a Reuters poll had expected a drawdown of 1.8 million barrels. US energy firms this week cut the number of oil rigs by seven to 425, their lowest since September 2021, energy services firm Baker Hughes said in its closely followed report on Thursday. Oil rig count is an indicator of future output. US job growth was solid in June while unemployment rates fell unexpectedly, data showed on Thursday. However, nearly half of the increase in nonfarm payrolls came from the government sector, with private sector gains slowing considerably as industries like manufacturing and retail grappled with Trump's aggressive tariffs on imports. 'Thursday's jobs report was stronger than expected, which shows that the resiliency we have been seeing in the economy over the past several months is still intact. We still expect the Federal Reserve to continue its wait-and-see approach on interest rates,' said David Laut, chief investment officer of Abound Financial. Both contracts hit one-week highs on Wednesday as oil producer Iran suspended cooperation with the UN nuclear watchdog, raising concerns that the lingering dispute over its nuclear programme could again evolve into armed conflict. Washington imposed new Iran-related sanctions on Thursday as well as sanctions targeting the Hezbollah network, the US Treasury Department website showed. 'For now, the market's going to take it in stride, because none of these efforts have worked in the past,' said John Kilduff, a partner at Again Capital. REUTERS
