Trump's global trade policy faces test, hours from tariff deadline
WASHINGTON : President Donald Trump's dream of a new world trade order faced a crucial test Thursday, with dozens of economies – including key commercial partners like Canada – yet to secure US tariff deals ahead of a midnight deadline.
The last-gasp scramble to strike bilateral accords came as an appeals court in Washington considered the legality behind Trump's strategy of invoking emergency economic powers to declare sweeping duties on imports.
The 79-year-old Republican doubled down on the wide-ranging levies, posting on Truth Social: 'Tariffs are making America GREAT & RICH Again.'
He insisted in a separate post that the world's biggest economy would have 'no chance of survival or success' without protectionist measures.
But question marks linger over the effectiveness of Trump's grand plan – and whether he will really follow through on his most dramatic threats.
With just hours to go before his declared deadline, Trump announced that he was delaying a tariff hike on Mexican products, originally due Friday, for 90 days after talks with his counterpart Claudia Sheinbaum.
White House press secretary Karoline Leavitt said Trump will sign an executive order Thursday to implement his various threatened tariff rates.
Other road bumps remain.
While Trump has touted a surge in customs revenues since the start of the year, economists warn the duties could fuel inflation.
And the US court of appeals for the federal circuit was hearing arguments Thursday in cases brought against Trump's blanket tariffs targeting various economies.
A government lawyer told the court that Trump's tariff orders were covered by 'broad discretion' he enjoys when it comes to handling national emergencies – including pressing economic issues.
A lower court's ruling had blocked most of the duties from taking effect, prompting the Trump administration's challenge. The duties have been allowed to remain for now.
Deal or no deal
So far, Washington has announced pacts with Britain, Vietnam, Japan, Indonesia, the Philippines, South Korea and the European Union, with new rates expected to take effect Friday.
South Korea squeezed in a last-minute agreement on a 15% tariff, significantly below the 25% that Trump threatened on its goods.
But Trump announced 50% tariffs on Brazilian products – although delaying their imposition and allowing key exemptions – as an effort to pressure the US ally to drop its prosecution of right-wing former president Jair Bolsonaro on coup charges.
He also unveiled a 25% levy on Indian imports, and warned Canada it would face trade repercussions for planning to recognize a Palestinian state.
And the details of agreements that have been made remain vague.
The EU, while having reached a pact, continues pushing for a carve-out for its wine industry.
Looming over the entire global economy is the still unresolved trade tussle between the United States and its chief rival China, with the superpowers in talks to maintain a truce after earlier imposing triple-digit tariffs on each other.
Canada threat
Washington has yet to finalise a deal with neighbouring Canada, while Trump said he was maintaining existing 25% duties on Mexican imports.
Canada's trade relations with the US came under renewed threat after Prime Minister Mark Carney announced plans to recognise a Palestinian state at the UN General Assembly in September.
'That will make it very hard for us to make a Trade Deal with them,' Trump warned on social media.
Carney said Wednesday: 'It is possible that we may not conclude talks by August 1st.'
Goods covered by a North American trade pact have been excluded from Trump's latest tariffs.
Although Mexico and Canada were not originally targeted under Trump's 'reciprocal tariff' plan, he had separately threatened both neighbours with the same Friday deadline.
The tariff hikes due Friday were announced in April when Trump slapped a minimum 10% levy on goods from almost all partners – citing unfair trade practices.
This rate was set to rise to varying levels for dozens of countries, but Washington twice postponed their implementation.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New Straits Times
an hour ago
- New Straits Times
Rupee likely to hold ground after Trump ramps up tariff heat on Indian goods
MUMBAI: The Indian rupee is expected to open largely unchanged on Thursday, showing limited reaction to US President Donald Trump's additional tariffs on Indian goods, which traders said was largely expected and factored in. The 1-month non-deliverable forward indicated the rupee will open in the 87.70-87.75 range versus the US dollar, largely unchanged from Wednesday's close of 87.7325. Indian equities too appeared largely unfazed by the additional tariffs, with GIFT Nifty futures pointing to a muted open. On Wednesday, Trump hit Indian goods with an extra 25 per cent tariff, blaming oil ties with Russia. The new duties, kicking in on August 28, could lift tariffs on some exports to 50 per cent - one of the steepest rates for a US trade partner. "We knew more tariffs were coming after all those hints by Trump," a currency trader at a private sector banks said. It appears that the rupee and Indian equities had largely priced them in, he added. The rupee's measured response to the new tariffs likely reflects the Reserve Bank of India's (RBI) resolve to prevent a breach of the all-time low of 87.95, the trader said. The central bank was likely selling dollars via state-run banks on Tuesday when the currency was at risk of slipping past that level. India-US trade relations have entered a turbulent phase, marked by escalating tariffs and the US's unease over New Delhi's continued energy engagement with Russia. The developments have raised concerns about higher volatility in Indian assets, with investors bracing for the fallout from worsening relations. The additional tariffs were not "entirely unexpected", especially since Trump had recently threatened substantial tariffs on India, Barclays Bank said, adding that if implemented in full, would "certainly dent India's growth outlook". However, the bank added that the announcement likely represents a pressure tactic and expects the final US duty on Indian goods to settle lower.
The Star
an hour ago
- The Star
Exclusive-Rubio orders US diplomats to launch lobbying blitz against Europe's tech law
WASHINGTON (Reuters) -President Donald Trump's administration has instructed U.S. diplomats in Europe to launch a lobbying campaign to build an opposition to the European Union's Digital Services Act, which Washington says stifles free speech and imposes costs on U.S. tech companies, an internal diplomatic cable seen by Reuters showed. In a State Department cable dated August 4 that was signed by U.S. Secretary of State Marco Rubio, the agency said the EU was pursuing "undue" restrictions on freedom of expression by its efforts to combat hateful speech, misinformation and disinformation and the DSA was further enhancing these curbs. The EU's DSA is a landmark law that is meant to make the online environment safer and fairer by compelling tech giants to do more to tackle illegal content, including hate speech and child sexual abuse material. Trump has made combating censorship - particularly what he sees as the stifling of conservative voices online - a major theme of his administration. Top U.S. officials, including Vice President JD Vance, have focused on European officials and regulations, accusing them of "censoring" Americans, an accusation that the European Union rejects. The cable, whose headline described it as an "action request", tasked American diplomats across U.S. embassies in Europe with regularly engaging with EU governments and digital services authorities to convey U.S. concerns about the DSA and the financial costs for U.S. tech companies. "Posts should focus efforts to build host government and other stakeholder support to repeal and/or amend the DSA or related EU or national laws restricting expression online," the cable said in its "objective" section, referring to U.S. diplomatic missions. It provided specific suggestions to U.S. diplomats on how the EU law may be changed and the talking points to help them make that argument. State Department did not comment for this story. EU tech chief Henna Virkkunen's office did not immediately respond to a request for comment. In March, EU's antitrust and tech chiefs told U.S. lawmakers that the new tech rule aimed to keep digital markets open and is not targeted at U.S. tech giants. The Commission has also pushed back against speculation that the 27-member EU's landmark tech regulatory regime could be included in the EU-U.S. negotiations. "Our legislation will not be changed. The DMA and the DSA are not on the table in the trade negotiations with the U.S.," Commission spokesperson Thomas Regnier told a daily news conference. A CAMPAIGN FOR "FREE SPEECH" The order to U.S. diplomats marks an acceleration of the administration's efforts to promote what it calls "America's free-speech tradition," a policy that has added friction to the already fraught U.S. relationship with European allies. That policy came into focus in February, when Vance stunned European leaders by accusing them - at a conference usually known for displays of transatlantic unity - of censoring the speech of groups such as Germany's right-wing AfD party and backsliding on democracy. During his trip, Vance went on to meet with the leaders of AfD — classified by Germany's domestic intelligence service as a suspected extremist group — which became the country's largest opposition party after the February election. Trump and his Republican allies have repeatedly accused the administration of Democratic former President Joe Biden of encouraging suppression of free speech on online platforms, claims that have centered on efforts to stem false claims about vaccines and elections. The U.S. Supreme Court ruled last year that the Biden administration's contacts with social media companies did not violate America's First Amendment protections around free speech. The directive by the State Department ordered U.S. diplomats to investigate any claims of censorship which it described as "any government efforts to suppress protected forms of expression or coerce private companies to do the same", adding that the priority should be given to any incidents that impact U.S. citizens and companies. Examples could include arrests, court cases, property seizures and online suspensions, it said. "Posts should meet with government officials, businesses, civil society, and impacted individuals to report on censorship cases, including but not limited to those related to the DSA," the cable said. In March, the chairman of the U.S. Federal Communications Commission (FCC) specifically criticized DSA saying it was not compatible with America's free speech tradition. In May, Rubio threatened visa bans for people who "censor" speech by Americans, including on social media, and suggested the policy could target foreign officials regulating U.S. tech companies. "OVERLY BROAD CONTROLS" U.S. tech companies like Facebook and Instagram parent Meta have weighed in too, saying the DSA amounts to censorship of their platforms. Tesla Chief Executive Elon Musk, who also owns social media company X, was a leading adviser to the U.S. president before the two fell out, while the bosses of Amazon, Meta and Google-owner Alphabet (GOOGL.O) took prominent spots at Trump's inauguration in January. Rubio's directive takes particular aim at DSA's description of illegal content, saying it was expansive and told U.S. diplomats to advocate to get the definition of "illegal content" narrowed so that it would not curb freedom of expression, including in political and religious discourse. Another suggestion was to withdraw or amend the Code of Conduct on Disinformation, a framework under DSA, which the State Department said was setting "overly broad controls" on content in a way that was undermining freedom of expression. Other talking points included removing or reducing fines for non-compliance to content restrictions and not relying on "trusted flaggers", entities designated by national authorities to report illegal online content to platforms. (Reporting by Humeyra Pamuk; editing by Diane Craft)
The Star
2 hours ago
- The Star
Sony hikes profit forecast seeing smaller trade war impact
TOKYO (Reuters) -Sony raised its full-year operating profit forecast on Thursday by 4% to 1.33 trillion yen ($9.01 billion), citing expectations of a smaller impact from U.S. President Donald Trump's trade war. Sony sees a tariff impact of 70 billion yen, compared to 100 billion yen forecast in May. It said the estimated impact is based on tariff rates as of August 1 and that the situation remained fluid. Japanese companies such as Honda Motor have trimmed their expected hit from tariffs amid a reduction in uncertainty with Japan striking a trade deal with the U.S. last month. Sony also said it sees a stronger profit outlook at its games business, boosted by sales of network services and favourable exchange rates. Sony was once well known as a maker of household electronics such as the "Walkman" portable cassette player but has become an entertainment behemoth spanning games, movies and music as well as a leading maker of image sensors for smartphones. The group reported a 36.5% rise in operating profit to 340 billion yen for the April-June quarter, beating the 288 billion yen average of eight analyst estimates compiled by LSEG. Shares in Sony, which announced results during the midday trading break, jumped 5%. Sony sold 2.5 million PlayStation 5 game consoles in the first quarter, a 4% rise compared to the same period a year earlier. Quarterly operating profit at the games business more than doubled to 148 billion yen due to higher sales of network services and games not made by Sony. The console industry was set to receive a boost this year from the launch of "Grand Theft VI" but the latest addition to the popular series has been delayed to 2026. Nintendo, which is seen as a potential beneficiary of GTA 6's delay, last week reported robust early demand for its new Switch 2 gaming device. Elsewhere in the conglomerate, Sony is preparing to cut its stake in its financial unit to less than 20% through a partial spin-off, with the business to list in Tokyo on September 29. ($1 = 147.5700 yen) (Reporting by Sam Nussey; Additional reporting by Chang-Ran Kim; Editing by Muralikumar Anantharaman and Christopher Cushing)
