Elizabeth Morgan | Trump tariffs – What April 2 could portend

CONCERNS ABOUT Donald Trump’s tariff proposals have been expressed in this column repeatedly since September 2024, when the then presidential candidate floated his tariff proposals.

Today, President Trump, from the White House Rose Garden, will be announcing his great tariff proposal which is to herald the rebirth of the USA as an industrial power – it will be the great US ‘liberation day’. The US trade deficit will be reduced. Tariffs will also bring increased revenue to reduce US debt. Be reminded that this great liberation is from the US’s own trade policies over the last nearly 80 years.

THE VISIT OF SECRETARY OF STATE, MARCO RUBIO

It is agreed that the visit of Secretary of State Marco Rubio to the Caribbean last week went fairly well. As senator, Rubio served on the Committee on Foreign Relations and became the ranking member on the Subcommittee on Western Hemisphere, Transnational Crime, Civilian Security, Democracy, Human Rights, and Global Women’s Issues. In this post, he gained experience in Western Hemisphere foreign relations matters and diplomacy, and met Caribbean leaders.

Rubio basically addressed the regional issues one would expect – security, immigration, energy, trade and, of course, the much-publicised Cuban medical personnel issue. In Guyana, he did point out that trade was not his portfolio. This column supports The Gleaner’s view in its editorial of Sunday, March 30: “Notwithstanding the affability displayed by Mr Rubio at all stops – Jamaica, Guyana, Suriname – while stressing America’s wish for partnership with the region on security and economic development, it would be unwise for the Caribbean to be lulled into a false assuredness that all the region’s concerns have been addressed, or secured.”

Promises made are often not promises that can be kept, and, indeed, no comfort should be taken from this visit.

EXECUTIVE ORDERS AND TARIFFS

According to the American Bar Association, an executive order is a signed, written, and published directive from the US president that manages operations of the federal government. Executive orders are not legislation, require no approval from Congress, and Congress cannot overturn them. Congress may pass legislation that might make it difficult, or even impossible, to carry out the order, such as removing funding. Only a sitting US president may overturn an existing executive order by issuing another executive order to that effect.

Certain legislation allows the president to impose tariffs in particular emergency situations, mainly: the 1962 Trade Expansion Act; 1976 National Emergency Act; 1977 International Emergency Economic Powers Act, and the 1974 Trade Act. Under the 1974 Trade Act, the imposition of tariffs by the president is allowed temporarily to address a balance of payments deficit; it is limited in time to 150 days, and to the amount of 15 per cent. It appears that, so far, this provision has not been used by a US president.

President Trump has initially invoked the emergency acts, citing the “extraordinary threats” to national security posed by illegal immigration and drug trafficking, particularly fentanyl, to impose tariffs on Mexico and Canada, disregarding the US-Mexico-Canada trade agreement.

Since coming to office on January 20, Trump has issued about 12 executive orders addressing international trade. These have levied tariffs on goods from Canada, Mexico, and China of 10-25 per cent, triggering trade wars. He has also threatened to impose tariffs on the European Union and on other US trade partners. This has the potential of not only increasing trade wars, but of triggering a global recession.

The president has announced the likelihood of imposing tariffs on countries importing oil from Venezuela, which might affect CARICOM countries. Note, interestingly, that the USA has been importing oil from Venezuela.

He has raised imposing reciprocal tariffs, requesting that a study be undertaken, and these tariffs are to be announced today, April 2.

TODAY’S TARIFF ANNOUNCEMENTS

Jamaica and other CARICOM countries have to be listening keenly to the Trump reciprocal tariff announcement today. He plans to impose tariffs on goods imported into the USA from countries which impose tariffs on US exports. Even with US permission?

To clarify, Donald Trump stated that these reciprocal tariffs will be imposed on all US trade partners. The details are being awaited.

If so, CARICOM countries will be impacted. There are already concerns about the tariffs on Venezuelan oil importers, and the sanctions on Chinese shipping.

So, The Jamaica Manufacturers and Exporters Association will be having their biennial expo this weekend, starting on Thursday. The manufacturers and exporters, not only in Jamaica, but across the region, should be listening for these tariff announcements, which they surely now realise are not election rhetoric.

At the press conference of the 48th CARICOM Heads conference in Barbados in February, Prime Minister Andrew Holness, as chair of the Prime Ministerial subcommittee on Trade Negotiations, noted that the region had concerns about the grave changes in US trade policy. He stated that the region needed to be prepared and thus, the CARICOM Secretariat had been looking very seriously at its trade relations with the USA and undertaking the necessary analysis. Consultations will be ongoing in the region to examine both the disruptions and the opportunities which could arise.

At least, we know that work is in progress in CARICOM on the trade policy front.

CORRECTION

In last week’s article on the US’s possible associate membership of the Commonwealth, the official title of the head of the Commonwealth and its 15 realm states is King Charles III, not King Charles II.

Elizabeth Morgan is a specialist in international trade policy and international politics. Send feedback to columns@gleanerjm.com.