Trump Accelerates Trade Deals Ahead of August Tariff Deadline
Reporter Kim Nan-young = Forward of the implementation of mutual tariffs on August 1, U.S. President Donald Trump is concentrated on finalizing agreements with numerous nations. On the twenty second (native time), he introduced two commerce agreements in simply sooner or later, and negotiations with South Korea are anticipated to succeed in a turning level this week.
Major Trade Agreements Announced with Japan and Philippines
President Trump introduced by Reality Social that he has signed the most important commerce settlement with Japan up to now. That is the fourth settlement made with an Asian nation for the reason that mutual tariff announcement on April 2nd. On the identical day, he additionally acknowledged that he had signed a commerce settlement with Ferdinand Marcos Jr., the President of the Philippines, throughout his go to to the White Home.
Five Countries Reach Deals with U.S. Before Tariffs Take Effect
With this announcement, america has reached commerce agreements with a complete of 5 nations forward of the mutual tariffs implementation subsequent month. Till now, the nations that had reached agreements with america have been 4: the UK, Vietnam, Indonesia, and the Philippines.Initially, the evaluation of commerce negotiations between america and Japan was that they have been at an deadlock.
Initial U.S.–Japan Negotiations Characterized by Tension
President Trump had expressed skepticism about reaching an settlement with Japan, stating, “I can’t be positive of an settlement,” and described the Japanese aspect as “having no manners” as late as earlier this month. He had additionally pressured Japan to impose tariffs of 30-35%.The primary points within the commerce negotiations between america and Japan embody U.S. rice exports and the 25% tariffs imposed on vehicle merchandise by america. On this context, President Trump publicly criticized Japan through the negotiations, mentioning this yr’s rice scarcity in Japan and stating, “Regardless of experiencing a major rice scarcity, they do not settle for our rice.”
Key Sticking Points: Rice and Auto Tariffs in U.S.–Japan Talks
Japan’s home political scenario was additionally fairly difficult. Within the present section of the Home of Councillors elections this month, Prime Minister Shigeru Ishiba was unable to flee low approval rankings, resulting in evaluations that Japan’s negotiation energy was not favorable. However, simply days earlier than the implementation of reciprocal tariffs, a commerce settlement was abruptly introduced.
Japan’s Domestic Politics Weakened Its Negotiating Position
This seems to mirror President Trump’s want to attain as many outcomes as doable earlier than the negotiation deadline arrives. President Trump claimed in an April interview with TIME journal that he had reached agreements with numerous nations totaling 200, however there had been only a few precise agreements introduced since then.
Trump Seeks Rapid Results Ahead of Tariff Deadline
In response, President Trump lately despatched letters to nations with which agreements had not been reached, notifying them of the reciprocal tariff charges and asserted that “the letter is the settlement.” Moreover, Treasury Secretary Scott Pruitt acknowledged in a media interview that “what President Trump is anxious about will not be the amount of agreements however the high quality.”
Pressure Strategy: Letters Sent Declaring Tariff Rates as Agreements
For now, america is prone to proceed specializing in extra agreements till the top of the lunar month. On this regard, President Trump acknowledged on the fifteenth that efforts are underway to finalize an extra 5 to six agreements earlier than the expiration of the mutual tariff deadline. At the moment, it was simply earlier than the announcement of agreements with the Philippines and Japan, and there’s a chance that an extra 3 to 4 agreements might be concluded.
More Deals Expected Before Lunar Month-End, Says Trump
Attention is focused on the negotiation situation with South Korea. This week in South Korea, following National Security Chief Wi Seung-lak, Minister of Trade, Industry and Energy Kim Jong-kwan is on his way to the U.S. Minister of Economy and Finance Koo Yun-cheol and Head of the Trade and Investment Bureau Yeo Han-goo are also planning to visit the U.S. for 2+2 trade consultations, and Foreign Minister Jo Hyun is expected to visit as well.With a significant visit from government ministers, U.S. negotiations are reaching a critical point, and the trade agreement announced with Japan that day could serve as a sort of guideline for the final stages of negotiations between South Korea and the U.S. Both South Korea and Japan are countries that run large trade surpluses with the U.S. and have been top targets for President Trump’s tariff measures.
High-Level South Korean Delegation Heads to U.S. for Talks
In fact, earlier this month, President Trump sent letters to both South Korea and Japan notifying them of a 25% mutual tariff, frequently mentioning issues related to automobile trade and defense costs. A point of similarity between South Korea and Japan is that tariffs on items such as automobiles and steel, along with agricultural products like rice, are contentious issues in negotiations with the U.S.On that day, Japan managed to reduce mutual tariffs from the existing 25% to 15% by expanding rice imports and committing to large investments in the U.S., and it achieved a reduction in the tariff on automobile products to 12.5%, which is half of the previous rate (adding Japan’s previous 2.5% tariff makes a total of 15%).
Japan’s Concessions May Set Template for South Korea Agreement
There is a possibility that an agreement will be reached with South Korea along similar lines.Even if trade agreements are reached with various countries, the Trump administration’s policy is to maintain a 10% basic tariff, making it difficult to completely abolish mutual tariffs with the U.S. In this regard, former U.S. Trade Representative (USTR) Michael Bison recently cited a tariff rate of 15-18% as a standard for successful agreements with South Korea.
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