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Donald Trump has said he would impose 25 per cent tariffs on imports of goods from Japan and South Korea, in an announcement that sent US stocks sliding.
The president on Monday said the new levies on both countries would come into effect on August 1 — potentially offering the nations extra time to strike a deal with the US.
The announcement of the tariff rates comes ahead of a July 9 deadline when Trump’s so-called “reciprocal” levies are set to snap back into effect following a 90-day partial suspension.
Trump triggered a global stock market rout on April 2 this year when he unveiled sweeping tariffs of up 50 per cent on most US trading partners, including 24 per cent on imports from Japan and 25 per cent on imports from South Korea.
The fresh tariffs on Japan and South Korea are close to Trump’s original reciprocal tariffs on the two Asian countries.
In letters posted on his Truth Social platform, Trump said the US goods trade deficit with both countries was a “major threat to our economy and indeed our National Security”.
In the letters, addressed to Shigeru Ishiba, Japan’s prime minister, and Lee Jae-myung, South Korea’s president, Trump added that if either country increased its tariffs in retaliation “then, whatever the number you choose to raise them by, will be added on to the 25 per cent that we charge”.
But, in an indication that the proposed tariffs could be negotiated down, he also said that if the countries opened their markets “we will, perhaps consider an adjustment . . . These tariffs may be modified, upward or downward, depending on our relationship with your Country”.
The S&P 500 fell to session lows after the announcement, leaving it down about 0.9 per cent. Japan’s yen and the Korean won extended earlier declines to trade 1.1 per cent lower against the dollar.
Trump has escalated his rhetoric against Tokyo in recent weeks, singling out the crucial US trading partner and attacking them as “spoiled” for refusing to purchase more American rice.
Scott Bessent, US Treasury secretary, on Sunday said tariffs on imports from some countries will “boomerang” back to the steep April levels unless they quickly offer concessions and strike deals with Washington.
Speaking to CNN, he said Trump would inform countries that failed to reach agreements with the US that higher levies on their imports would take effect next month.
Bessent said: “I’m not going to give away the playbook. We’re going to be very busy over the next 72 hours.”
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