Donald Trump is putting global trade partners on high alert, announcing a wave of new tariffs set to kick in August 1. In letters sent Monday, Trump informed leaders from 14 countries, including Japan, South Korea, Malaysia, and South Africa, of tariff rates climbing as high as 40%.
While the original deadline was July 9, Trump signed an executive order pushing the date for “reciprocal” tariffs to August 1, excluding China. Asked if the new deadline was set in stone, he said, “I would say firm, but not 100% firm.”
South Korea and Japan, both facing a 25% tariff, were the first to respond. South Korea warned of “immediate and bold action” if market conditions worsen. Japan called the move “regretful” and is pursuing a bilateral trade deal.
Trump’s letters cite trade deficits and foreign trade policies that “impede” U.S. exports. “These Tariffs may be modified, upward or downward, depending on our relationship,” he wrote.
Malaysia, Kazakhstan, South Africa, Myanmar, and Laos were also notified, with South Africa disputing the tariff basis as “an inaccurate representation” of trade data.
Stocks took a hit on the news. U.S.-listed shares of Toyota, Nissan, and Honda dropped 4%, 7.16%, and 3.86% respectively. The Dow fell 422 points.
Trump’s message to global leaders: manufacture in the U.S. or face rising costs.
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