US customs agents began collecting President Donald Trump’s unilateral 10 per cent tariff on all imports from many countries on Saturday (Apr 5), with higher levies on goods from 57 larger trading partners due to start next week.
The initial 10 per cent “baseline” tariff paid by US importers took effect at US seaports, airports and customs warehouses at 12.01am Eastern Time (4.01am GMT), ushering in Trump’s full rejection of the post-World War II system of mutually agreed tariff rates.
“This is the single biggest trade action of our lifetime,” said Kelly Ann Shaw, a trade lawyer at Hogan Lovells and former White House trade adviser during Trump’s first term.
Shaw told a Brookings Institution event on Thursday that she expected the tariffs to evolve over time as countries seek to negotiate lower rates. “This is a pretty seismic and significant shift in the way that we trade with every country on earth,” she added.
Trump’s Wednesday tariff announcement shook global stock markets, wiping out US$5 trillion in value for S&P 500 index companies by Friday’s close, a record two-day decline. Driven by recession fears, prices for oil and commodities plunged while investors fled to the safety of government bonds.
Among the countries first hit with the 10 per cent tariff were Australia, Britain, Brazil, Colombia, Argentina and Saudi Arabia despite their having goods trade deficits with the US last year. White House officials have said many countries would run larger deficits with the US if their policies were fairer.
A US Customs and Border Protection bulletin provided a 51-day grace period for cargoes loaded or in transit to the US before 12.01am Eastern Time on Saturday. These cargoes need to arrive by May 27 to avoid the 10 per cent duty.
Trump’s higher “reciprocal” tariff rates of 11 per cent to 50 per cent are due to take effect on Wednesday at 12.01am Eastern Time. European Union imports will face a 20 per cent tariff, while Chinese goods will be hit with a 34 per cent tariff, bringing Trump’s total new levies on China to 54 per cent.
The Trump Administration has imposed a 44 per cent reciprocal tariff on Sri Lanka and according to experts it will have a major impact on the local apparel industry.
Source: Reuters
-Agencies
