Trump Tariffs To Come Into Effect From August 7; How It Will Impact Different Nations?

Donald Trump has unveiled a new set of tariffs affecting numerous countries, most of them are set to face the new tariffs from 7 August. This move could challenge global economies, as several nations have yet to finalise trade agreements with the Trump administration. A minimum tariff of 10% is now applied globally.

The White House released a list on Thursday detailing nations subject to tariffs ranging from 10% to 41%. Countries not on this list will still face a standard 10% duty on exports to the US. Trump had initially planned to impose these tariffs from 1 August but delayed them by a week just before the deadline.

Impact on Global Trade

Some of America's major trading partners, including the European Union, the United Kingdom, and Japan, have reached or are close to reaching deals. However, they still face higher duties than before Trump's presidency. Meanwhile, China and Mexico have received deadline extensions but are expected to pay more eventually.

Trump argues that these tariffs will revive US manufacturing and encourage other nations to lower trade barriers for American goods. "There's 200 countries," he said earlier this month. "You can't talk to all of them." Despite Trump's claim that foreign exporters will bear the brunt, economists say US businesses are mostly footing the bill as imported goods become costlier.

Countries Without Agreements

Nations without agreements face tariffs ranging from 10% to 40%, including large economies like India, Canada, and Taiwan, and smaller ones such as South Africa and Lesotho. The US granted Mexico a 90-day extension due to its complex trade ties under the updated USMCA deal from Trump's first term.

Smaller nations have been particularly vulnerable. Lesotho faced a 50% tariff in April, which was later postponed. Even the threat alone devastated its apparel sector, causing widespread job losses. On Thursday, it was hit with a 15% duty.

Recent Trade Agreements

In last-minute negotiations, Trump announced several trade deals up until Thursday, though most lack specifics. On Thursday, the US and Pakistan finalised an agreement expected to help develop Pakistan's oil reserves while reducing tariffs for the nation.

On Wednesday, Trump revealed a deal with South Korea imposing a 15% tariff on Korean goods - lower than the previously threatened 25%. Agreements were also concluded with the EU, UK, Pakistan, Indonesia, Vietnam, and the Philippines. However, the deal with the Philippines only slightly reduced its tariff rate from 20% to 19%.

Nations Yet To Secure Deals

Of the 68 nations listed in Trump's executive order along with the EU, most have yet to secure deals. These include Algeria facing a 30% tariff; Iraq at 35%; Syria at 41%; Switzerland at 39%; and Taiwan at 20%. Trump had already imposed steep duties on Brazil and India before August's deadline.

On Wednesday night, he signed an order placing a 50% tariff on Brazilian imports but exempted key sectors like aircraft and aluminium. India faces a 25% tariff partly due to its ongoing oil trade with Russia.

Uncertainty Over Tariff Implementation

By Thursday afternoon, both White House officials and Trump insisted no additional delays would be allowed. Yet later in the evening when Trump signed an order imposing new tariffs on 68 countries and the EU; implementation was pushed back by seven days for updates to be made.

This short postponement may offer some respite for countries still negotiating deals with the US but has stirred fresh uncertainty among businesses unclear about what exactly will happen or when it will begin.