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Asian nations push for US tariff concessions before August deadline
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Asian nations push for US tariff concessions before August deadline
Jul 8, 2025 6:18 AM

WASHINGTON/TOKYO (Reuters) -Powerhouse Asian economies Japan and South Korea said on Tuesday they would try to negotiate with the U.S. to soften the impact of sharply higher tariffs that President Donald Trump now plans to impose from the start of August.

Trump ramped up his trade war again on Monday, telling 14 nations that they would face tariffs ranging from 25% for countries including Japan and South Korea, to 40% for Laos and Myanmar.

However, with the start date pushed back to August 1, those countries were focusing on the new three-week window to press for an easier ride.

Stephen Miran, chairman of the White House Council of Economic Advisers, said he was optimistic that more trade deals could be struck before the end of the week.

"However, it's incumbent upon the other countries to make the concessions that convince the president that the deals are worth taking for America," Miran told Fox News.

Japan wants concessions for its large automobile industry, top trade negotiator Ryosei Akazawa said on Tuesday.

Akazawa said he held a 40-minute phone call with U.S. Commerce Secretary Howard Lutnick in which the two agreed to actively continue negotiations. However, he said he would not sacrifice Japan's agriculture sector - a powerful political lobby domestically - for the sake of an early deal.

South Korea said it planned to intensify trade talks over the coming weeks "to reach a mutually beneficial result."    Asked if the latest deadline was firm, Trump replied on Monday: "I would say firm but not 100% firm. If they call up and they say we'd like to do something a different way, we're going to be open to that."

Global stocks were flat to marginally higher on Tuesday, as investors took in their stride the latest twist in the tariff saga, but the yen slid on the prospect of duties on Japanese goods.

Economists warned that the long-running tariff disputes risked stunting growth and pushing up prices, causing headaches for policymakers.

"The ongoing threat of higher tariffs intensifies stagflationary risks in the U.S. and puts pressure on Europe to stimulate domestic demand further in order to offset headwinds in international trade," said David Kohl, chief economist at Swiss-based bank Julius Baer.

EUROPEAN UNION EYES DEAL

The European Union, which is the largest bilateral trade partner of the U.S., aims to strike a deal before August 1 with negotiations focused on "rebalancing" and concessions for certain key export industries, a European source familiar with the negotiations said.

However, German Finance Minister Lars Klingbeil warned that the EU was prepared to retaliate if necessary.

"If we don't reach a fair trade deal with the U.S., the EU is ready to take counter measures," Klingbeil said on Tuesday, speaking in the lower house of parliament.

Some EU sources had said late on Monday that the bloc was close to an agreement with the Trump administration.

This could involve limited concessions to U.S. baseline tariffs of 10% for aircraft and parts, some medical equipment and spirits.

Only two deals have been struck so far, with Britain and Vietnam. Trump has also said a deal with India was close.

Washington and Beijing agreed to a trade framework in June, but with many of the details still unclear, traders and investors are watching to see if it unravels before a separate, U.S.-imposed August 12 deadline or leads to a lasting detente.

SPREADING THE PAIN

Trump said the United States would impose tariffs of 25% on goods from Tunisia, Malaysia and Kazakhstan, with levies of 30% on South Africa, Bosnia and Herzegovina, climbing to 32% on Indonesia, 35% on Serbia and Bangladesh, 36% on Cambodia and Thailand and 40% on Laos and Myanmar.

Cambodia, hit hard by levies imposed in April, on Tuesday hailed as a big success a reduction in the tariff rate from 49% to 36% and said it was seeking to negotiate a further cut.

The tariffs have been an issue for Cambodia's garments and footwear sector, a major employer and the biggest driver of its economy.

The U.S. is also the main export market for Bangladesh's ready-made garments industry, which accounts for more than 80% of its export earnings and employs 4 million people.

"This is absolutely shocking news for us," Mahmud Hasan Khan, president of Bangladesh Garment Manufacturers and Exporters Association, told Reuters on Tuesday.

"We were really hoping the tariffs would be somewhere between 10-20%. This will hurt our industry badly." 

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