US's Asia-Pacific allies stung by Trump tariffs

US's Asia-Pacific allies stung by Trump tariffs

China vowed "countermeasures" to Donald Trump's sweeping tariffs on Thursday but elsewhere in the Asia-Pacific region US allies were still scrambling for last-ditch talks to mitigate the levies that will hit Asia's manufacturing powerhouses hard.

Trump on Wednesday announced 10-percent levies on imports from around the world -- and extra duties on key trading partners.

These include Japan, one of Washington's closest strategic allies whose firms are the biggest investors into the United States.

But lobbying by Tokyo including a White House visit by Prime Minister Shigeru Ishiba failed to secure an exemption, with Trump announcing a 24-percent levy on Japanese imports.

"The fact that such measures were implemented despite these efforts is extremely regrettable," Ishiba said Thursday.

Japanese government spokesman Yoshimasa Hayashi also said that the US measures may contravene World Trade Organization rules and the two countries' trade treaty.

But he declined to comment on whether Japan might impose retaliatory measures.

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In February, Ishiba promised Trump a trillion dollars in investments, while Trump said Japan would partner in a "gigantic natural gas pipeline in Alaska".

Japan has also failed to win exclusion from 25-percent tariffs on imports into the United States by its massive auto sector that came into force on Thursday.

Taiwan also enjoys close historical ties to the United States but Trump saddled the island with a 32-percent tax, although all-important semiconductor chips are excluded.

Taiwan had also pledged increased investment in the United States, more purchases of US energy, and greater defence spending.

Around 60 percent of Taiwan's exports to the United States are information and communications technology products, or ICT, which includes chips.

"The surge in US demand for Taiwan's ICT products reflects Taiwan's significant contribution to the US economy and national security, yet Taiwan is now being hit with high tariffs," cabinet spokeswoman Michelle Lee said.

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"The Executive Yuan found the decision highly unreasonable and deeply regretted it, and will initiate serious negotiations with the United States," Lee added.

'No winner'

The United States has been Australia's strongest military ally since World War II but it too was not spared.

Prime Minister Anthony Albanese said Australia would not retaliate but said: "This is not the act of a friend."

Australia, where one in four jobs depends on trade, charges nothing on US imports, Albanese said, calling the tariffs "unwarranted" and saying they undermine "our free and fair trading relationship".

But ANZ Bank agribusiness analyst Michael Whitehead said Australia had, in some ways, gotten off lightly.

"Ten percent on Australian beef at the moment, it's better than a lot of people were expecting -- or less worse, let's call it," he told AFP.

Trump unveiled tariffs of 34 percent on China, one of its largest trading partners, on top of a 20 percent rate imposed last month. China responded to those with levies of up to 15 percent on a range of US agricultural goods.

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"There is no winner in a trade war," Beijing said Thursday, adding that "history has proven that raising tariffs does not solve the US's own problems".

Beijing's Commerce Ministry said it will "resolutely take countermeasures to safeguard its own rights and interests" and that the levies "do not comply with international trade rules".

Penguins

Southeast Asian countries came in for harsh treatment, with Vietnam hit with a 46 percent levy and Cambodia 49 percent.

Vietnam, a manufacturing powerhouse heavily reliant on exports, this week said it cut import duties on a range of goods in an apparent attempt to head off Trump's ire.

Washington's trade deficit with Vietnam is its third highest.

With the country's geographical position and cheap skilled labour, it was a major beneficiary of the trade war between Beijing and Washington during Trump's first term.

Thai Prime Minister Paetongtarn Shinawatra said he had a "strong plan" on how to respond, believing that there remained room to negotiate.

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Deputy Finance Minister Julapun Amornvivat said Thailand would "negotiate with understanding, not aggressive talk. But we have to talk which products they feel are unfair and we have to see whether we can adjust."

Australia also expressed puzzlement about a 29-percent trade tariff on its tiny Pacific territory of Norfolk Island, nearly three times higher than the Australian mainland's 10 percent.

The island is home to a little over 2,000 people and exported a paltry Aus$2.7 million (US$1.7 million) of goods in 2019.

Trump also slapped 10 percent on Australia's Heard and McDonald Islands territory in the sub-Antarctic, uninhabited by humans but home to large numbers of penguins.

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