Caribbean countries were on Thursday sizing up the magnitude of the sweeping tariffs announced by US President Donald Trump on their respective economies, with some indicating that they would be seeking to hold talks with Washington on reducing the impact of the new taxes.
Trump on Wednesday announced far-reaching new tariffs on nearly all US trading partners ranging from a 34 per cent tax on imports from China and 20 percent on the European Union, among others, in a move economists and other traders say is designed to dismantle much of the architecture of the global economy and trigger broader trade wars.
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In the case of the Caribbean, Trump announced a 10 percent tariff on most regional countries, while in the case of Guyana, the tariff is as high as 38 percent.
Trump said that the tariffs were designed to boost domestic manufacturing, used aggressive rhetoric to describe a global trade system that the United States helped to build after World War II, saying “our country has been looted, pillaged, raped and plundered” by other nations.
The Guyana government said it is engaging the United States on the 38 percent reciprocal tariffs with Finance Minister Dr Ashni Singh saying “the government of Guyana has taken note of the reciprocal tariffs announced by the US government… our Government is closely engaged with our US partners to better understand the issue and have it addressed as appropriate”.
The Private Sector Commission (PSC) warned that Guyana would be severely affected by the protectionist measure.
“The United States remains Guyana’s largest trading partner, making it imperative for us to carefully assess the implications of this recent tariff,” PSC Chairman, Komal Singh said, adding “a comprehensive review is necessary to identify common ground and ensure that bilateral trade continues to thrive as our economy expands”.
Guyana’s major exports to the US include crude oil, gold, rum, sugar and seafood and Singh cited the need for Guyana and the US to hammer out a resolution to the brewing trade dispute.
The Trinidad and Tobago government said it intends to negotiate responsibly with the Trump administration.
Prime Minister Stuart Young, speaking at a public meeting of the ruling People’s National Movement (PNM) on Wednesday as it prepares for the April 28 general election, told supporters that they could trust the PNM to act responsibly to negotiate its best interest in light of new tariffs imposed by the US.
Young said he is “prepared to sit across the table and negotiate regardless of who is on the other side”.
Foreign and CARICOM Affairs Minister, Dr Amery Browne, said, “we are concerned that spiraling instability in global trade and economic policy will have significant negative repercussions, particularly for smaller nations.
“Our country, and much of CARICOM, fortunately, is in a relatively low tariff bracket and the government, as always will be consulting and working with all key stakeholders as together we navigate the challenges of our times,” he told the Newsday newspaper.
Antigua and Barbuda Prime Minister Gaston Browne, noting the new tariffs by Washington, posted on his Facebook page a newspaper article that read “under the arrangement, Antigua and Barbuda maintains its existing 10 percent tariff on US goods, while receiving a matching 10 percent discounted reciprocal tariff from the United States”.
Minister in the Ministry of Finance in Barbados, Ryan Straughn said the reality is that everything, including goods, will be impacted by the tariff increase.
He said producers will now have to find the most efficient way to produce their products, “which could mitigate the increase in tariffs or take the bold step and move as a cooperative to be able to invest directly in the United States …in order to avoid paying the tax.
“The options are available now and I suggest to persons that we have to utilize the full global supply chain in relation to our responding to issues like this, but equally we must ensure that we look at other markets,” Straughn told the state-owned CBC television.
Straughn said that CARICOM countries should seek to take further advantage of intra-regional trade, particularly given the fact that the Common External Tariff (CET) provides for “mostly duty-free” entry in regional markets among member states.
“We have put these tariffs in place as a measure to protect domestic and regional businesses as we try to ensure that issues relating to food security as well as jobs…and therefore to the extent that CARICOM, as a body, as a group in relation to these matters we have the Common External Tariff in place of which the United States would be one of those countries that apply as one of those countries out of CARICOM and therefore I think from a regional perspective we all will have to ensure that we focus on how do we get support for our producers in being able to access the full global supply chain and be able to start to do more trade with each other”.
Straughn said within that context “I say to Barbadians, the government of Barbados and CARICOM, we have engaged actively with the Afreximbank, the African Export-Import Bank to be able to do more trade with Africa and therefore to the extent we can enhance our production capacity then it means that the impact of these products coming into the United States…we work hard not only to enhance trade within CARICOM itself but more trade with Africa”
He said CARICOM should also not miss looking at the Latin American market.
Economists say that the action by the United States amounts to a historic tax hike that could push the global order to a breaking point.
Trump said he was acting to bring in hundreds of billions in new revenue to the US government and restore fairness to global trade.
“Taxpayers have been ripped off for more than 50 years,” he said. “But it is not going to happen anymore.” (CMC)
