Trump imposes 50% copper tariffs as he broadens his trade war
He says Washington will soon send a tariff letter to the European Union
[WASHINGTON] US President Donald Trump on Tuesday (Jul 8) said he would impose a 50 per cent tariff on imported copper and soon introduce long-threatened levies on semiconductors and pharmaceuticals, broadening his trade war that has rattled markets worldwide.
A day after he pressured 14 trading partners, including powerhouse US suppliers like South Korea and Japan, with sharply higher tariffs, Trump reiterated his threat of 10 per cent tariffs on products from Brazil, India and other members of the Brics group of countries.
He also said trade talks have been going well with the European Union (EU) and China, though he added he is only days away from sending a tariff letter to the EU.
Trump’s remarks, made during a White House cabinet meeting, could inject further instability into a global economy that has been shaken by the tariffs he has imposed or threatened on imports to the world’s largest consumer market.
US copper futures jumped more than 10 per cent after Trump’s announcement of new duties on a metal that is critical to electric vehicles, military hardware, the power grid and many consumer goods.
They would join duties already in place for steel, aluminum and automobile imports, though it was unclear when the new tariffs might take effect. US pharmaceutical stocks also slid following Trump’s threat of 200 per cent tariffs on drug imports, which he said could be delayed by about a year.
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Other countries, meanwhile, said they would try to soften the impact of Trump’s threatened duties after he pushed back a Wednesday deadline to August 1.
Trump’s administration promised “90 deals in 90 days” after he unveiled an array of country-specific duties in early April. So far only two agreements have been reached, with the UK and Vietnam. Trump has said a deal with India is close.
He added that many countries have been clamouring to negotiate their own deals with the US.
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“It’s about time the United States of America started collecting money from countries that were ripping us off ... and laughing behind our back at how stupid we were,” he said.
Trading partners across the globe say it has been difficult to negotiate even framework agreements with the US given the haphazard way new tariffs are announced, complicating their internal discussions about concessions.
Highest levels since 1934
Following Trump’s announcement of higher tariffs for imports from the 14 countries, US research group Yale Budget Lab estimated consumers face an effective US tariff rate of 17.6 per cent, up from 15.8 per cent previously and the highest in nine decades.
Trump’s administration has been touting those tariffs as a significant revenue source.
Treasury Secretary Scott Bessent said Washington has taken in about US$100 billion so far and could collect US$300 billion by the end of the year. The US has taken in about US$80 billion annually in tariff revenue in recent years.
The S&P 500 finished slightly lower on Tuesday, a day after Wall Street markets sold off sharply following Trump’s new tariffs announcement.
Trump said he will “probably” tell the EU within two days what rate it can expect for its exports to the US, adding that the 27-member bloc had been treating his administration “very nicely” in trade talks.
The EU, the largest bilateral trade partner of the US, aims to strike a deal before Aug 1 with concessions for key export industries such as aircraft, medical equipment and spirits, according to EU sources. Brussels is also considering an arrangement that would protect European automakers with large US production facilities.
However, German Finance Minister Lars Klingbeil warned that the EU was prepared to retaliate if necessary.
“If we don’t reach a fair trade deal with the US, the EU is ready to take counter measures,” he said in the lower house of parliament.
Japan, which faces a possible 25 per cent tariff, wants concessions for its large automobile industry and will not sacrifice its agriculture sector, a powerful domestic lobby, for the sake of an early deal, top trade negotiator Ryosei Akazawa said on Tuesday.
South Korea, which also faces a possible 25 per cent tariff, said it planned to intensify trade talks over the coming weeks “to reach a mutually beneficial result”.
Washington and Beijing agreed to a trade framework in June, but with many of the details still unclear, traders and investors are watching to see if it unravels before a separate, US-imposed Aug 12 deadline or leads to a lasting detente.
“We have had a really good relationship with China lately, and we’re getting along with them very well. They have been very fair on our trade deal, honestly,” Trump said, adding that he has been speaking regularly with Chinese President Xi Jinping.
Trump said the United States would impose tariffs of 25 per cent on goods from Tunisia, Malaysia and Kazakhstan; 30 per cent on South Africa and Bosnia and Herzegovina; 32 per cent on Indonesia; 35 per cent on Serbia and Bangladesh; 36 per cent on Cambodia and Thailand; and 40 per cent on Laos and Myanmar.
Cambodia hailed as a big success a reduction in the tariff rate from 49 per cent to 36 per cent and said it was seeking to negotiate a further cut. The tariffs have been an issue for Cambodia’s garments and footwear sector, the biggest driver of its economy.
The US is also the main export market for Bangladesh’s ready-made garments industry, which accounts for more than 80 per cent of its export earnings and employs 4 million people. REUTERS
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