President Donald Trump's new tariffs give some countries a break, while shares and US dollar sink

Chicago Tribune

7 days ago

BANGKOK — U.S. President Donald Trump's new tariff rates of up to 41% on U.S. imports from dozens of countries drew expressions of relief Friday from some countries that negotiated a deal or managed to whittle them down from rates announced in April. Others expressed disappointment or frustration over running out of time after hitting Trump's Aug. 1 deadline for striking deals with America's trading partners.
The new rates are due to take effect on Aug. 7, but uncertainty over what Trump might do next remains. The way ahead for China, which runs the largest trade surplus with the U.S., is unclear after talks earlier this week in Stockholm produced no deal. Trump has yet to say if he'll extend an Aug. 12 pause on painfully high import duties on Chinese products.
The reaction from financial markets was muted. Benchmarks fell in Asia, with South Korea's Kospi dropping nearly 4% after the tariff rate for the U.S. ally was set at 15%. The U.S. dollar weakened against the Japanese yen, trading at more than 150 yen per dollar.
Canadian Prime Minister Mark Carney said his government was disappointed by Trump's move to raise the U.S. tariff on goods from America's northern neighbor to 35% from 25%, effective Friday. Goods transshipped from unspecified other countries face a 40% import duty.
Trump cited what he said was a lack of cooperation in stemming trafficking in illicit drugs across the northern border. He also slammed Canada's plan to recognize a Palestinian state and has expressed frustration with a trade deficit largely fueled by U.S. oil purchases.
'Canada accounts for only 1% of U.S. fentanyl imports and has been working intensively to further reduce these volumes,' Carney said in a statement.
Many of Canada's exports to the U.S. are covered by the U.S.-Mexico-Canada Agreement and face no tariff. But steel, lumber, aluminum and autos have been subject to still higher tariffs.
Switzerland was reeling after Trump ordered a 39% tariff rate for the land of luxury watches, pharmaceuticals and financial services. That was up from his original proposal of a 31% duty.
'The Federal Council notes with great regret that, despite the progress made in bilateral talks and Switzerland's very constructive stance from the outset, the U.S. intends to impose unilateral additional tariffs on imports from Switzerland,' the government said in a post on X. It said it would continue to seek a negotiated solution.
The surprisingly high rate 'is likely to be negotiated down in future and, importantly, pharmaceutical goods still appear to be exempt for the time being,' said Adrian Prettejohn, Europe economist at Capital Economics. However if the rate remains it would cut Swiss GDP by 0.6% and more if pharmaceuticals are not exempted, he said.
Novartis, the Swiss pharmaceutical giant, said in a statement that it remained 'committed to finding ways to improve access and affordability for patients.' The Federation of the Swiss Watch Industry says it is 'very disappointed and surprised' and added that 'we expect that the Swiss authorities continue to negotiate and find a better solution.' Swiss luxury watch brands — with products that cost tens of thousands of euros and up — are expected to be hit hard by the tariffs.
Swatch and Rolex declined to comment Friday.
New Zealand officials said Friday they would keep lobbying Trump to cut the 15% tariff he announced for their country's exports to the U.S., up from the original 10% baseline set in April.
'We don't think this is a good thing. We don't think it's warranted,' Trade Minister Todd McClay told Radio New Zealand. The exporter of meat, dairy, wine and farm machinery ran a $1.1 billion trade surplus with the U.S. in 2024, according to U.S. Trade Representative data.
McClay said New Zealand exporters had reported they could absorb a 10% tariff or pass it on to U.S. consumers through increased costs. A further increase would 'change the equation,' he said.
Neither New Zealand nor its neighbor Australia have struck tariff deals with the Trump administration. Australian steel and aluminum exports have faced a steep 50% tariff since June.
Australian Trade Minister Don Farrell said the 10% overall tariff on Australia's exports to the United States was a vindication of his government's 'cool and calm negotiations.' But he said even that level was not justified. The U.S. exports twice as much to Australia as it imports from its bilateral free trade partner, and Australia imposes no tariffs on U.S. exports.
Objecting to a 15% tariff rate, Norwegian Prime Minister Jonas Gahr Støre told the newspaper VG the Scandinavian country should have 'zero tariffs.' He said talks were continuing.
Japanese Chief Cabinet Secretary Yoshimasa Hayashi was cautious in welcoming Trump's executive order setting Japan's tariff at 15% after the two sides worked out an agreement, much to Tokyo's relief.
'We believe it is necessary to carefully examine the details of the measure,' Hayashi said. 'The Japanese government will continue to urge the U.S. side to promptly implement measures to carry out the recent agreement, including reducing tariffs on automobiles and auto parts.'
Taiwan's President Lai Ching-te said the self-ruled island had yet to engage in final negotiations with the U.S. side owing to scheduling difficulties and that he was hopeful the final tariff rate would be reduced even further after a final round of talks.
The Trump administration lowered its tariff for Taiwan to 20% from the originally proposed 32%. Taiwan is a key supplier of advanced semiconductors needed for many products and technologies.
'20% from the beginning has not been our goal, we hope that in further negotiations we will get a more beneficial and more reasonable tax rate,' Lai told reporters in Taipei Friday.
The U.S. is Taiwan's largest ally even though it does not formally recognize the island. 'We want to strengthen U.S. Taiwan cooperation in national security, tech, and multiple areas,' Lai said.
Cambodia's Deputy Prime Minister Sun Chanthol, who led his nation's trade talks with the United States, thanked Trump for setting the tariff rate on Cambodian goods at 19% and said his country will impose zero tariffs on American goods.
The rate for Cambodia that Trump proposed in April was 49%, one of the highest in the world. He said the U.S. estimated average Cambodian tariffs on U.S. exports at 97%.
Cambodia has agreed to up purchases of U.S. goods. Sun said it would purchase 10 passenger aircraft from Boeing in a deal they hoped to sign later this month. Several other nations had already announced similar aircraft purchase deals as part of their trade packages.
Trump had threatened to withhold trade deals from Cambodia and Thailand if they didn't end an armed conflict over border territory. The two nations agreed on a ceasefire that began Tuesday.
Thailand also is subject to a 19% tariff, a rate that its Finance Minister Pichai Chunhavajira said 'reflects the strong friendship and close partnership between Thailand and the United States.' That was down from 36% proposed earlier.
'The outcome of this negotiation signals that Thailand must accelerate its adaptation and move forward in building a stable and resilient economy, ready to face global challenges ahead,' he said.
Pakistan welcomed a trade deal that sets a 19% duty on its exports, lower than the initial plan for 29%, saying in a government statement that it was a 'balanced and forward-looking approach' that could boost trade and economic growth.
For Bangladesh, a new 20% tariff warded off an earlier threat of a 35% import duty for the South Asian exporter of garments and other light manufactured goods. 'That's good news for our apparel sector and the millions who depend on it,' said Khalilur Rahman, the country's national security advisor and lead negotiator.
'We've also preserved our global competitiveness and opened up new opportunities to access the world's largest consumer market' Rahman said. 'Protecting our apparel industry was a top priority, but we also focused our purchase commitments on U.S. agricultural products. This supports our food security goals and fosters goodwill with U.S. farming states.'