August deadline for trade deals or April tariffs ‘boomerang back’
The US government sent formal letters to trading partners around the world on July 7 warning them to accelerate the process of agreeing a trade deal with the US.
US president, Donald Trump, announced an extensive range of punitive tariff rates on trading partners in April. In mid-May, the president postponed the imposition of the highest tariff rates for 90 days. Those 90 days are up on July 9.
Recent comments from US Treasury secretary, Scott Bessent, confirm that the letters would begin to reach trading partners on July 7, giving them a few more weeks to secure a trade deal with the US.
He told broadcaster CNN: “President Trump is going to send letters to some of our trading partners saying that if they don’t move things along, then on August 1, they will boomerang back to the April 2 tariff level.”
In recent weeks, Vietnam and the UK have signed new trade deals with the US. Some of the detail still requires clarification. For example, President Trump claimed that, under the new deal, imports from Vietnam would be subject to a tariff of 20%. Imports from third countries moving to Vietnam for shipping to the US will be subject to tariffs of 40%.
With regard to products shipping from the US to Vietnam, these will move duty-free, President Trump said. No documentation so far confirms that the government of Vietnam has agreed to this.
Image shows container ships on the Saigon River, near Ho Chi Minh City in Vietnam.
Credit: Wikipedia/Syced.
