The US is imposing new tariffs on around 60 trading partners accounting for the vast majority of its imports over claims they failed to properly stop forced labour.
The duties, ranging from 10% to 12.5%, target key economic partners – including the UK, China, EU, Canada, Japan and India. They come in on Friday, as a temporary 10% tax on foreign goods introduced earlier this year expires.
The move is 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.
So the president has since sought other legal avenues to pursue his flagship trade policy.
It was last month that the White House first proposed a series of 10-12.5% duties on goods arriving to American shores 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 in his second term had made adoption of a ban on imports made 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.
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 in his statement he was “encouraged by the trading partners who have moved quickly to adopt forced labour import prohibitions, and look 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 said.
Credit: Source link
