After setting a new Aug. 1 deadline for ongoing trade negotiations over the weekend, U.S. President Donald Trump began informing America’s trading partners about their new duty rates under his tariff regime.
On Monday, the president posted on Truth Social that a number of countries will now be subject to new double-digit tariff rates based on “significant” trade imbalances with the U.S. These rates are different than those announced on “Liberation Day” on April 2.
The first missives went out to Japan and South Korea, both of which have been engaged in discussions with U.S. officials that Trump has characterized as difficult. The countries will now be subject to 25 percent across-the-board duties, the president wrote, to achieve “more balanced and fair” trade. Exports to the U.S. will face these double-digit tariffs, which are separate from 25 percent sectoral tariffs on goods like steel, aluminum and automobiles.
Notably, the president also included a clause in his open letter to the countries dictating that any goods making their way into the U.S. via transshipment “to evade a higher tariff” will be subject to that higher tariff rate. The president also wrote that should the countries choose to raise duties on U.S. goods, the duty rate they choose will be added to the 25 percent tariff.
Shortly after Truthing these developments Monday morning, a flurry of tariff announcement letters began to flood the platform laying out disparate rates, but similar terms, for impacted countries.
- Ready-made-garment powerhouse Bangladesh, along with Serbia, will face 35 percent tariffs. Cambodia and Thailand will see 36 percent duties. All countries are subject to higher transshipment rates and will incur stacked duties if they implement their own tariffs on the U.S.
- Malaysia, Tunisia and Kazakhstan now face tariff rates of 25 percent, higher duties on potential transshipments, and the value of any retaliatory tariffs charged by the countries on U.S. goods will be added to the initial duty rate.
- South Africa, Bosnia and Herzegovina will face a 30 percent tariff rate, a higher rate for transshipments, and any duties levied against the U.S. will be stacked on top of the 30 percent tariffs.
- Indonesia will now face a duty rate of 32 percent, a higher rate for transshipments and will incur added duties if it retaliates with duties of its own.
- Laos and Myanmar will face 40 percent duties on exports to the U.S., higher rates for transshipments, and the value of tariffs imposed on the U.S. will be added to the 40 percent duty rate.
White House Press Secretary Karoline Leavitt on Monday afternoon said the president would be signing an executive order officially delaying the July 9 deadline to Aug. 1.
“So the reciprocal tariff rate, or these new rates that will be provided in this correspondence to these foreign leaders, will be going out the door within the next month, or deals will be made and those countries continue to negotiate with the United States,” she said. “We’ve seen a lot of positive developments in the right direction, but the administration, the president and his trade team will cut the best deals for the American people and the American worker.”
Leavitt said she expected that Trump would sign and release about 12 letters, though she did not stipulate a time frame.
Steve Lamar, president and chief executive officer of the American Apparel and Footwear Association, said he doesn’t believe this week’s policy changes represent a shift in the president’s forward-looking intent to impose tariffs. They’re merely a deviation from the previous timeline, designed to provide more breathing room for dealmaking.
“I think this just represents his particular brand of negotiating strategy; trying to keep up pressure on those countries that he really wants to do a deal with,” he explained. “It’s not that he is having second thoughts, or that he’s not going to do it — it’s ‘I’m giving the negotiating parties who are operating in good faith more time to finish.’”
Lamar said he believes there are several dozen important trading partners currently engaged in promising negotiations with the administration. Others that are behind on engaging in trade talks — or those that have had trouble reaching consensus with U.S. trade officials — may be the ones that see letters from the administration laying out trade terms, rather than joint agreements.
According to Lamar, the letters in their current form don’t provide enough details for American companies to base sourcing decisions around. “Deals are going to happen, they’re going to trickle out, but the details behind those deals are going to take time — and those details matter,” he said.
In the case of Vietnam, for example, which reached a trade deal with Washington last week, specifics surrounding the implementation of a 20 percent duty rate remain up in the air.
That leaves the question of will it be stacked on top of existing most-favored nation tariffs, or will existing rates for certain sectors remain in place? According to Lamar, AAFA members are hoping that the new tariff rates don’t add to existing duties. “This industry already pays a very, very high tariff burden, and we don’t want to magnify that, because that’s just going to hurt consumers,” he said.
“With Vietnam, and we’re talking about the number-two supplier for apparel, for footwear, for accessories; one in every four shoes is coming from Vietnam,” he added. “For many companies, as they’re looking to diversify from China, they went to Vietnam over the years. So, at a time when we’re still trying to help companies or incentivize them to diversify from China, a burdensome tariff on Vietnam sends the opposite message.”
Washington, D.C.-based public policy and research organization the Center for American Progress spoke out about the newly announced duties on Japan and South Korea, with senior fellow Ryan Mulholland saying that the action undermines America’s relationships with two of its “closest partners” and plays into China’s hands.
“To curb any effort to effectively counter China on trade, security or anything else, the United States needs to cooperate closely with its partners in Tokyo and Seoul. The United States did this in 2023 when it signed the American-Japanese-Korean Trilateral Pact, which led to two longtime competitors working together — and with the United States — to counter China,” he said. “But now these insulting letters from President Trump give Japan and South Korea even more incentive to work with China to promote trade in Asia and less incentive to build trade partnerships in the United States. This is yet another example of the Trump administration creating chaos, making our country less prosperous, less secure and even more isolated.”
