Trump Slaps 25% Tariffs On Japan, South Korea; To Delay Trade Deal Deadline To Aug 1
Trump warned Japan and South Korea against retaliation by increasing their own import taxes, saying that the US would further increase the tariffs over and above the already imposed 25 percent.
US President Donald Trump on Monday announced that he would slap 25 percent tariffs on imports from Japan and South Korea, as he released his first two letters ahead of the deadline to reach a trade deal. The letters come after Trump said that he would be sending a first batch of upto 15 letters to countries regarding the tariffs starting from Monday.
In another development, the White House on Monday announced that Trump will soon be signing an order to delay the trade deal deadline to August 1. Up until now, the deadline to reach a deal with the US was July 9.
The near-identical letters to the two Asian countries were shared by Trump on his Truth Social platform. He said the tariffs would be applicable from August 1 because their trading relationships with the US were "unfortunately, far from Reciprocal."
He also warned them against retaliation by increasing their own import taxes, saying that the US would further increase the tariffs over and above the already imposed 25 percent. However, he also said that the levies would be decreased if the two countries modified their trade policies.
“If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 25% that we charge,” Trump wrote in the letters addressed to Japanese Prime Minister Shigeru Ishiba and South Korean President Lee Jae-myung.
The letter noted that goods transshied to evade a higher tariff will be subjected to that higher tariff. "Please understand that the 25% number is far less than whar is needed to eliminate the trade deficit disparity we have with your country," it said.
"As you are aware, there will be no Tariff if Korea, or companies within your Country, decide to build or manufacture product within the United States and, in fact, we will do everything possible to get approvals quickly, professionally, and routinely - In other words, in a matter of weeks." the letter added.
While the tariff rate for South Korea is the same as that initially announced by Trump on April 2, Japan's rate is one point higher than initial announcement.
Earlier today, US Treasury Secretary Scott Bessent stated that he hopes to make several trade announcements in the next two days, revealing that his inbox was flooded with last-minute offers from various countries to reach a tariff deal before the July 9 deadline.
"We are going to have several announcements in the next 48 hours," Bessent told CNBC in an interview Monday. He also said that he would "be meeting with my Chinese counterpart sometime in the next couple of weeks."
"We've had a lot of people change their tune in terms of negotiations. So my mailbox was full last night with a lot of new offers, a lot of new proposals," he said.
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