At the beginning of July, Donald Trump revived his trade war mainly targeting the Asian partners of the United States. An unexpected tariff blow, yet another one, aimed primarily at punishing Southeast Asian nations that were serving as intermediate bridges for China to continue sending large volumes of goods to the US market, bypassing the high tariffs imposed on products imported directly from the second world power.
Later, the US president also targeted his traditional and most loyal partners in the region, Japan and South Korea, following a broader strategy to compel these nations to reduce their trade dependence on China, thus weakening Beijing's dominance of supply chains.
While in Beijing they have continued to stand up to Trump, not giving in during the new trade war, negotiators from the rest of Asian countries have maintained a more conciliatory profile and quickly got to work to reach a trade agreement with Washington before the August 1 tariff deadline.
After the first formal agreement reached in June with the United Kingdom, in Asia it was Vietnam that was the first to secure a reduction in the tariffs announced by Trump, from 46% to 20%. Both countries had already signed a preliminary agreement imposing a 40% tariff on all exports classified as "transshipments" or "goods originating from another country". In other words, manufactured in China.
"Vietnam will do something that they have never done before, give the United States of America TOTAL ACCESS to their Markets for Trade.In other words, they will 'OPEN THEIR MARKET TO THE UNITED STATES, meaning that, we will be able to sell our product into Vietnam at ZERO Tariff" said the Republican regarding the pact reached with a country that is an important manufacturing center for several major brands like Nike, Apple, or Gap.
This Wednesday, the main news was the trade agreement Trump reached with Japan, the fourth largest economy in the world: a reciprocal tariff of 15%. In a post on Truth Social, the president said the agreement would include $550 billion in Japanese investments in the US and that Japan would increase market access for US producers of automobiles, trucks, rice, and certain agricultural products, among other items.
"We just completed a massive Deal with Japan, perhaps the largest Deal ever made" wrote Trump, who did not mention any easing of tariffs on Japanese cars, which represent over a quarter of all the country's exports to the US and are subject to a 25% tariff.
Shortly before the announcement regarding Japan, Trump welcomed the President of the Philippines, Ferdinand Marcos Jr., to the White House, where they agreed on a new tariff rate for the archipelago of 19%, a slight reduction from the 20% announced earlier in the month. In 2024, the US had a deficit of nearly $5 billion with the Philippines. Trump also noted that US products would pay zero tariffs in the Philippines.
There have also been developments regarding the tariff truce reached between Washington and Beijing after meetings of their negotiators in two summits held in Geneva and London. Treasury Secretary, Scott Bessent, said on Tuesday that they are likely to negotiate an extension of that truce (both parties agreed to a 90-day suspension, until August 12) when he meets with his Chinese counterparts in Stockholm next week.