(Source: "Liberation Daily" 2025-07-08)
“With the possible increase in tariffs, it will be bad for inflation and the economy, and will completely subvert the WTO system and rules.”
U.S. President Trump said on the 7th that he would impose tariffs ranging from 25% to 40% on imported products from 14 countries starting from August 1st.
Among these countries are allies such as Japan and South Korea, as well as emerging market countries. The EU has not yet received a tariff threat letter.
Trump sent 14 letters together, even to his allies. What is his intention? What is the status of the tariff war game? What impacts will it bring?
Exclusive interview with a reporter from Jiefang Daily·Shangguan NewsTu Xinquan, Dean of the China WTO Research Institute at the w88 casino, Song Guoyou, deputy director of the Center for American Studies at Fudan University.
Why are tariffs hitting Japan and South Korea so hard?
Trump released his letter to the leaders of 14 countries, stating that the new tariffs will not include tariffs on other industries.
Why did Trump threaten Japan and South Korea with 25% tariffs?
Song Guoyou believes that, first, in Trump's eyes, Japan and South Korea are both allies and countries that "take advantage of the United States". They have not reached a tariff agreement with the United States so far, and their performance is unacceptable to Trump.
According to the U.S. Department of Commerce, Japan and South Korea are the sixth and seventh largest trading partners of the United States. The total value of goods exported to the United States by the two countries last year reached 280 billion US dollars, accounting for 60% of the 14 countries.
Second, the original 90-day suspension period of "reciprocal tariffs" is approaching, and Trump must respond, otherwise he will violate the executive order.
There are also comments that Trump's move also means to "kill the chicken to scare the monkeys", that is, to beat other negotiating partners: I can even kill my allies.
Tu Xinquan believes that, first, Trump has never cared much about allies and believes that the United States is strong enough and does not need allies. Second, protection fees are collected from "big advantage takers". Third, Japan and South Korea have a surplus with the United States, and the United States wants to make up for the deficit.
The outside world has noticed that in this letter, the proposed tax rate for South Korea is the same as that initially announced by Trump, while the proposed tax rate for Japan is 1 percentage point higher than that announced on April 2.
Tu Xinquan believes that the tax rate is in line with expectations. Even if Trump targets countries with deficits with the United States, he still imposes a base tariff of 10% to make up for the fiscal deficit.
Song Guoyou believes that the tax rate of about 25% proposed to be levied on Japan and South Korea is relatively high, equivalent to the average tax rate when Trump launched a w88 war with China during his first term.
Why is the sword pointing at the “BRICS” and “letting go” of the EU?
Among the 14 countries that Trump issued an ultimatum, there are also many emerging economies, including BRICS and partner countries.
Song Guoyou pointed out that according to WTO regulations, developing countries are allowed to maintain higher tariff levels than developed economies. Trump views such tax rates as "unfair" to the United States and has set his sights on these countries.
In addition, the WTO agreement clearly stipulates that developed countries do not expect reciprocity from their commitment to reduce tariffs on developing countries and may not require the latter to make concessions that are inconsistent with their development, financial and w88 needs. What Trump has done is obviously contrary to the important principles of multilateral trading system negotiations.
“Another reason is that Trump is worried that developing countries will become entrepots for China’s export w88. Therefore, he ‘swings a knife’ against ASEAN countries.” Tu Xinquan said.
As for the EU, why did Trump “open up the EU” this time?
Analysis pointed out that this may be mainly because the EU has sat at the negotiating table and plans to reach a w88 agreement before July 9.
It is unclear whether the US-EU negotiations have made substantial progress. Trump also heightened tensions last week by threatening to impose 17% tariffs on EU food and agricultural exports.
It is reported that there are currently disagreements within the EU on negotiations-whether to reach a simplified version of the w88 agreement as soon as possible, or to use its own economic influence to strive for a better agreement.
What is the situation of the subsequent game?
Song Guoyou believes that the subsequent tariff war will be "fighting and negotiating at the same time."
Trump will continue to exert extreme pressure repeatedly until he achieves results that he considers relatively satisfactory. The negotiating partner countries will strive to make progress before August 1. Among them, Japan's attitude is relatively tough. It depends on whether Trump has a new negotiation strategy. It is expected that both sides will make concessions to each other, it is just a question of who will make more concessions.
Some analysts believe that the final tax rate reached in the negotiations may be within the range set by Trump.
Josh Lipsky, chairman of international economic affairs at the Atlantic Council, said a three-week delay in imposing tariffs is unlikely to provide enough time for meaningful negotiations.
Tu Xinquan believes that Trump can be said to be both "tough" and "cowardly".
"If he had the ability, he could impose the tax today, but why extend the suspension period? It is obviously to give countries a time window and still wants to reach a deal." Tu Xinquan said, "It remains to be seen whether his pressure methods will be implemented. If the U.S. Supreme Court rules that the tax is illegal in the future, it will also restrain Trump."
Tu Xinquan said that therefore, all countries are now adopting the "drag strategy". "They feel that signing or not signing the agreement is almost the same thing. If they don't sign, they will be taxed. If they sign, they will still be taxed, but the tax rate is slightly lower, but they need to make concessions in other places."
What impact will it have on the world?
If Trump ends up imposing taxes on countries, it will be a double-edged sword.
For the United States, it will cause American consumers to pay higher prices.
For example, among the top commodities imported by the United States from South Korea and Japan are automobiles and parts, semiconductors, pharmaceuticals, and machinery. South Africa is the source of platinum imports to the United States. Malaysia exported large quantities of semiconductors to the United States last year. Bangladesh, Indonesia and Cambodia are major manufacturing centers for apparel and accessories.
The move could put the federal tax burden more on the middle class and the poor, as importers are likely to pass on the cost of tariffs to consumers.
The outside world has noticed that Trump’s threat to impose taxes has dragged down the U.S. capital market. As of the close of trading on the 7th, the three major U.S. stock indexes collectively fell.
For countries threatened by taxation, their economies may be affected, and the global economy may also be affected.
Tu Xinquan believes that if Trump wields the big stick of tariffs, it will harm others and not himself, and will bring disaster to the whole world, because many countries are highly dependent on US exports.
"With the 10% tariff imposed in the past few months, the impact of the tariff war on the US stock market is not so obvious, but the cost of the United States and the world is destined to increase. As tariffs may rise, it will be bad for inflation and the economy, and will also completely subvert the WTO system and rules. Many members have issued calls to expel the United States from the WTO..."
Attached original link:https://www.shobserver.com/staticsg/res/html/web/newsDetail.html?id=942662
