Jamie Grier from the U.S. Trade Representative's office announced plans to impose higher tariffs for certain countries, with a potential increase to over 15% if trade agreements are violated.
On May 25, U.S. Trade Representative Jamie Grier stated that the Biden administration will adjust global tariffs, initially set at 10%, to 15% for some countries. He indicated that higher tariffs might also be applied if unfair trade practices are identified in future investigations. The legal basis for the new global tariffs is rooted in Section 122 of the Trade Act, allowing for a maximum of 15% tariffs for up to 150 days, following a Supreme Court ruling that limited certain tariff practices. Grier emphasized the importance of maintaining continuity in existing tariff programs while increasing scrutiny on countries that had already reached agreements.
Grier also announced that a broad investigation into unfair trade practices would soon begin, as permitted under Section 301 of the Trade Act. This investigation will assess compliance with existing trade agreements across countries, including those that have previously signed agreements. He cited Indonesia as an example, where practices such as overproduction and fishing practices would be examined against prior agreements with the U.S. If countries are found in violation, they could be subject to higher tariffs.
Regarding China, Grier confirmed that the U.S. will maintain tariffs between 35 to 50% on specific items, with no immediate plans for increases. Nonetheless, he criticized China and Vietnam for their reliance on subsidies and support mechanisms that undermine fair trade, negatively affecting the U.S. market. The scope of tariffs based on national security, as stipulated in Section 232 of the Trade Expansion Act, is also expected to widen, affecting various sectors, including pharmaceuticals and semiconductors, indicating a proactive approach to trade negotiations and national security concerns.
