Asian Economies Seek Solutions to Trump's Proposed Reciprocal Tariffs
Asian economies are negotiating with the U.S. to mitigate the impact of impending reciprocal tariffs proposed by Trump. Most emerging economies may see increased tariffs, with India having the highest average rates.
PORTSMOUTH, UNITED KINGDOM - OCTOBER 28: The container ship Vung Tau Express sails loaded with shipping containers close to the English coast on October 28, 2024 in Portsmouth, England.
As the specter of Donald Trump's reciprocal tariffs looms, several Asian economies that enjoy substantial trade surpluses with Washington are scrambling to negotiate favorable solutions with the U.S. president to prevent being slapped with higher duties.
Trump said Friday that he would announce reciprocal tariffs -- duties that match those levied on U.S. goods by respective countries -- as soon as Tuesday, to take effect immediately. Trump did not identify which countries will be hit but indicated it would be a broad effort to help eliminate U.S. trade deficits.
While the details remain unclear, "it is likely that U.S. import tariffs will rise for most emerging Asian economies," a team of analysts at Barclays said Monday, with the exceptions of Singapore and Hong Kong, with which the U.S. enjoys trade surpluses.
Based on World Trade Organization estimates, most economies in Asia apply higher average tariffs on imports compared with the U.S. as of 2023. India led with a 17% simple average rate on countries with the most-favored-nation status, compared with the U.S. that levies 3.3%. The U.S. enjoys MFN status with most major economies, except Russia.
