US hits dozens of trading partners with new wave of tariffs

The US has imposed new tariffs on 60 trading partners as a temporary global levy brought in after the Supreme Court ruled against the Trump administration in February expires.

The duties, ranging from 10% to 12.5% and accounting for the vast majority of American imports, target key economic partners over claims they have failed to properly tackle forced labour – including the UK, China, the European Union, Canada, Japan and India.

They mark the latest escalation in the global trade war reignited by US President Donald Trump when he returned to office last year.

The US Supreme Court ruled earlier this year that many of the tariffs imposed globally under emergency powers were illegally enacted.

Last month, the White House proposed 10%-12.5% duties on imports from dozens of countries over concerns they were not doing enough to tackle forced labour.

On Thursday, US Trade Representative Jamieson Greer, acting under Trump’s direction, said those duties would now take effect.

“Today’s action will begin to correct what is both a human rights abuse and distortive trade practice to improve the welfare of workers everywhere,” his statement said.

Greer invoked Section 301 of the Trade Act of 1974, which governs US trade enforcement of practices that burden or restrict American commerce.

Earlier this week, the Trump administration invoked a different statute, Section 338 of the Tariff Act of 1930, to impose 50% tariffs on products from Canada.

On Thursday, the Office of the US Trade Representative said the latest tariffs were being imposed on partners “for their failure to impose and effectively enforce a prohibition on the importation of goods produced with forced labour”.

The new duties apply to the top 60 US trade partners covering 99.4% of US imports, it added.

The office said Trump had made adoption of a ban on imports produced with forced labour a “critical” part of reciprocal trade agreements with other nations.

It said so far 10 trading partners had agreed to enact such a ban in these agreements, and other countries had implemented bans in response to its investigations in recent weeks.

Advertisement

Trading partners that have “made commitments to adopt, and effectively enforce” bans on forced labour imports will be subject to a 10% tariff, while those that have not will have the higher 12.5% rate, the office added.

Greer said he was “encouraged by the trading partners who have moved quickly to adopt forced labour import prohibitions, and look[ed] forward to ensuring their effective enforcement”.

The new levies show the Trump administration is “determined” to push on with its tariff strategy, said trade policy expert Deborah Elms from the Hinrich Foundation.

It is unlikely countries hit with tariffs will be able to prove that they have sufficient measures to prevent forced labour imports, she told the BBC.

The levies are likely to raise costs for businesses and consumers, although its impact could be softened due to the number of exempted goods, said the Asia Society Policy Institute’s economic security expert Wendy Cutler.

Most trading partners will be disappointed with the new levies and are likely to focus on ways to “reduce their dependence on the US market” by making deals with other countries, Cutler added.

The head of the British Chambers of Commerce (BCC) told the BBC’s Today programme the UK had lost its comparative advantage against the European Union as a result of the new tariffs.

William Bain said the EU has a 10% all-inclusive deal for tariffs on its goods, while the UK is facing 10% universal tariffs on top of any duties imposed on individual goods.

“So there will be some concerns in the business community this morning about what the UK needs to do to get the same treatment the European Union has got here,” Bain added.

David Henig, director of UK trade policy at the European Centre for International Political Economy, also noted the UK’s relative disadvantage compared with the EU.

He told Today: “We have slightly moved backwards, but this is President Trump so anything could change tomorrow or the day after.

“I don’t think too many businesses will be changing their plans based on that.”