Blitz Bureau
NEW DELHI: With the United States Supreme Court ruling on February 20 that much of the tariffs imposed by the Trump administration was illegal Trump retaliated with fresh global tariffs. This has caused more confusion among countries that have signed trade deals over the last few months. Almost every nation including those that bent over backwards to strike a deal with Trump – will now face a 15 per cent tariff on most of its exports to the US from February 24. For months, officials from London, Brussels, Seoul, Jakarta and beyond worked rapidly to hammer out deals for their respective economies, reluctantly offering concessions to secure a preferential place. Now many find themselves in worse positions than if they had not struck deals at all. China, India and Brazil have been handed significant tariff cuts without making a single compromise. However, countries like the UK may now face higher tariffs, despite making concessions. The European Union has paused ratification of its deal with the US, demanding “full clarity”.
Countries that secured deals with Trump are no longer certain what they mean today. Countries in talks to cut deals of their own are left wondering what, exactly, they are negotiating over, says a Guardian report.
A delegation of Indian officials had been due to fly to Washington for trade talks this week. Their visit has now been delayed.
The Trump administration is leaning for now on a legal provision that only allows it to impose tariffs of up to 15%, and only until July. Section 122 of the Trade Act of 1974 – a provision never before used in this way – imposes a 150-day limit on its imposition. After that, the White House has outlined one element of what it is planning: using Section 301 of the same law to launch investigations over more tariffs.
Burden on consumers
While his administration claims tariffs enable the US to tax the world, analysis by the New York Federal Reserve found that 90 per cent of the economic burden has fallen on US companies and consumers.