Trump imposes double-digit tariffs on dozens of countries

WASHINGTON: President Donald Trump is going ahead with new double-digit tariffs on dozens of US trading partners just as the clock runs out on Friday on stopgap levies he imposed after a stinging defeat at the Supreme Court.

The United States will slap taxes of 10% to 12.5% on imports from 60 trading partners, accounting for 99% of US imports, charging that they have inadequately enforced bans on goods produced by forced labour.

“The United States has had a forced labour import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same,” said US Trade Representative Jamieson Greer.

The new tariffs will take effect just as temporary 10% worldwide tariffs expire at 12.01am on Friday. Trump had turned to those temporary levies after the Supreme Court struck down his biggest and boldest tariffs in February.

Now he’s tapping more durable tariffs under Section 301 of the Trade Act of 1974, which permits the president to impose import taxes and other sanctions against countries found to engage in “unjustifiable,” “unreasonable” or “discriminatory” trade practices. Trump used Section 301 to impose big tariffs on China in his first term, and they survived court challenges.

More Section 301 tariffs are likely coming: the US Trade Representative’s office has launched a probe into whether 16 countries — accounting for 70% of US imports — have overproduced goods, pushing down prices and putting US companies at a disadvantage in global markets. The administration has yet to complete that investigation.

Trump, who argues that high tariffs will revive American manufacturing, last year overturned decades of US policy that favoured lower tariffs and ever-freer trade. Invoking the 1977 International Emergency Economic Powers Act, or IEEPA, he imposed double-digit tariffs on imports from almost every country on Earth, saying America’s longstanding trade deficit amounted to a national emergency.

But the Supreme Court ruled that IEEPA did not authorise tariffs. The decision forced the administration to pay refunds to importers that had paid the tariffs.

In response, Trump announced 10% worldwide tariffs under Section 122 of the Trade Act of 1974. But he can only use Section 122 levies for 150 days; time runs out on them on Friday.

The administration initially proposed the forced labour tariffs last month. Since then, some countries have tightened forced labour enforcement and qualified for lower tariffs, said a senior administration official who spoke on condition of anonymity because they were not authorised to speak publicly on the matter. For example, the official said, the tariff on imports from India was initially set at 12.5% but will now be 10%.

Some products — including oil, gas and fertiliser — are exempted from the new tariffs announced on Thursday. Also being spared are products that qualify for duty-free status under the US–Mexico–Canada Agreement, the North American trade pact Trump negotiated in his first term.

The tariffs drew immediate fire from critics.

“Today’s forced labour justification is too convenient to be taken seriously,” said US Rep. Richard Neal of Massachusetts, the top Democrat on the House Ways and Means Committee. “Forced labour is a real and pervasive problem in our supply chains and demands serious enforcement. It should never be cheapened into a pretext for a tariff policy built on dubious legal theories and personal grievances.”

Brazil, which faces a 12.5% forced-labour tariff, called the US move “arbitrary and unjustified” in a statement. It plans to trigger its reciprocity law — which could call for retaliatory tariffs on the United States — and take a complaint to the World Trade Organization. The United States, the Brazilian government said, “chose to manipulate an issue of great importance to human rights and the struggles of workers worldwide in order to accuse 59 countries and the European Union of unfair practices.”

Chile’s undersecretary for international economic relations, Paula Estévez, said that the country has “solid labour institutions, a robust regulatory framework and a firm commitment to the prevention and eradication of forced labour.” Chile faces a 12.5% rate.

“The Government of Chile considers that the application of this measure to our country is inconsistent with these standards, as well as with the technical, political, and legal background presented throughout the investigation process,” she said.

Tariffs are paid by companies in the United States that import foreign products. The importers usually try to pass along the cost by charging consumers higher prices. Americans are already frustrated by the high cost of living, so the administration is taking a risk in rolling out new tariffs ahead of the 3 November midterm elections.

Human rights watchers say that it’s reasonable to be sceptical of the motivation behind the tariffs. But they say the levies could make an impact on the problem of forced labour.

The tariffs are being imposed on countries that the US found either failed to impose or failed to effectively enforce a ban on importing goods made with forced labour.

Forced labour is defined by the International Labour Organization Forced Labour Convention of 1930 as “all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself (or herself) voluntarily.”

According to the latest statistics from the ILO, which is a UN agency focused on human and labour rights, about 27.6 million people were in forced labour worldwide on any given day in 2021.

“We’ve gone on record for years now advocating for import bans, not as a magic bullet, it’s not a silver bullet, but as a potentially effective tool in combating forced labour across the globe,” said Martina Vandenberg, founder and president of The Human Trafficking Legal Center.

“It’s possible to be extremely critical of tariffs, as we are, and to be very concerned about blanket tariffs used as bludgeons against countries,” she said. “And yet I think it’s undeniable that there is a significant response in terms of the adoption of import bans.”

However, Vandenberg and her organisation urged in testimony that the tariffs be implemented in a phased approach to give countries time to implement a ban or a plan for enforcement.

“Our concern is that the import bans will be thin slips of paper with no enforcement,” she said. “Countries need time to build import ban mechanisms that are meaningful and enforceable.”

In a statement, Dominic LeBlanc, the Canada–US trade minister, said the move “is not unexpected.”

LeBlanc said Canada shares the US’s objective of ensuring that goods produced with forced labour don’t enter the supply chain.

“We will continue engaging constructively with the United States on this matter, as well as other outstanding issues, over the coming weeks to the mutual benefit of our citizens,” LeBlanc said.

Kenya Davis, partner at Boies Schiller Flexner, said the Uyghur Forced Labor Prevention Act, a US federal law passed in 2021 that prohibits the importation of goods made wholly or in part in China’s Xinjiang region or by designated entities, is the most significant legislation related to forced labour that the US has passed before the tariffs.

“The level of effectiveness is certainly up for debate, but it certainly has drawn attention to the issue of labour trafficking and forced labour,” she said. “And so, if nothing else, these import bans will serve that function of bringing greater awareness to forced labour.”

But without a “comprehensive approach” that provides transparency about what the investigations consisted of, and programmes that provide countries aid in enforcing bans, “I’m very cautious in my enthusiasm about the tariffs,” she said.

Isabelle Glimcher, senior research scientist for global labour at the NYU Stern Center for Human Rights, said one flaw in the tariffs is that they focus on levying the tax on countries based on goods they import — not goods they make domestically.

But she said the impending tariffs threat has spurred several countries — such as India — to amend their foreign trade policies to include a forced labour import ban. European Union forced labour regulations due to go into effect later next year are also contributing, she said.

“Not all of these things are necessarily or wholly attributable to the Section 301 investigations, but it does seem like countries are responding and starting to take all of this seriously,” she said.

By RSS/AP