The US administration has launched a process to reverse-engineer tariffs invalidated by the Supreme Court last month and will target the largest US trading partners with the new measures.
The US Trade Representative's office (USTR) late on Tuesday announced an investigation into "structural excess capacity and production in manufacturing sectors" of China, the EU, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, South Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan and India. USTR is citing its legal authority under Section 301 of the Trade Expansion Act of 1974, which allows targeting a foreign trade partner for unfair practices.
All those jurisdictions have been subject to emergency tariffs of 15pc and higher since last April. The US Supreme Court struck down those tariffs on 20 February. President Donald Trump's administration on the same day imposed a 10pc tariff on all US imports, which will be in effect until 24 July. USTR is aiming to have the new Section 301 tariffs in place by that deadline.
The choice of targets for new tariffs likely reflects the perceived need to preserve the trade deals Trump negotiated with those trade partners in the past year. Mexico is the only surprise choice — the country's trade with the US is covered by the US-Mexico-Canada trade agreement, which is due to be reviewed beginning in July.
The Section 301 process does not affect existing tariffs on steel, aluminum, cars and auto parts.
USTR likely will begin to roll out new tariffs soon after concluding a public hearing on 5 May.
