President Trump is leaning on national security to justify a fresh wave of tariffs, while floating new threats on Chinese magnets and digital taxes. At the same time, the administration is moving to end de minimis shipping benefits, even as foreign postal services pause their own reforms. The White House is refining existing trade deals but reaffirmed “no changes” to the South Korea agreement after talks with President Lee. Meanwhile, a new bill in Congress would require approval before U.S. companies can sell advanced chips to China, underscoring how technology and security are increasingly intertwined in today’s trade battles. - JR
Provided by: JR Holcomb, Director of Foreign Trade Operations, Alliance Corridor, Inc.
The Trump administration is significantly expanding national-security tariffs under Section 232 of the Trade Expansion Act, broadening duties beyond steel and aluminum to cover more than 400 new products such as auto parts, construction machinery, and robotics equipment. Officials are also weighing tariffs on semiconductors, pharmaceuticals, aircraft parts, and heavy trucks, potentially impacting over $300 billion in imports. The move aims to redirect production to the U.S. while strengthening the legal basis for tariffs as reciprocal duties face court challenges. Supporters, including U.S. steelmakers, argue the tariffs protect domestic industries, but manufacturers like Caterpillar and Ford warn they are absorbing billions in extra costs. Some relief measures—such as rebates, quotas, and phased timelines—are under consideration, particularly for firms investing in U.S. facilities. While allies like the EU and Japan have secured partial commitments to limit duties in certain sectors, Trump retains wide authority to adjust tariffs unilaterally. Critics caution that the sweeping levies could strain supply chains, raise costs, and undermine U.S. manufacturers despite the administration’s reshoring goals.
The Trump administration will end duty-free treatment for low-value imports on Aug. 29, eliminating “de minimis” privileges for shipments under $800, a move officials say will curb narcotics trafficking, counterfeits, and tariff evasion. The change follows Trump’s earlier suspension of de minimis for China and Hong Kong and comes years ahead of the scheduled 2027 phase-out in U.S. law. While major carriers like FedEx and UPS have not reported disruptions, postal services in countries including Japan, Germany, and Australia have paused shipments to the U.S. as they adapt. White House adviser Peter Navarro blamed foreign postal systems for failing to meet compliance standards, noting they lag far behind express shippers in monitoring illicit goods. Administration officials said postal packages make up just 5 percent of de minimis shipments but account for more than half of narcotics seizures, and they highlighted that CBP has already collected nearly $500 million in new duties since May. Supporters, including U.S. manufacturers and advocacy groups, say the change levels the playing field for domestic industry, while critics warn it could drive up shipping costs, cause unexpected duty fees, and lead to packages being returned. CBP has introduced a six-month transition allowing specific duty rates by country, but logistics companies caution the system remains unprepared for the volume and liability challenges it may create.
Nearly a month after President Trump’s Aug. 1 deadline for new trade deals, many of the agreements announced remain incomplete as negotiations continue with key partners including South Korea, Japan, the European Union, Canada, China, and Chile. Talks with Seoul and Tokyo center on how their multibillion-dollar investment pledges in U.S. industry will be structured, with officials clarifying that much of the funding may come through loans or guarantees rather than direct government payments, despite Trump’s earlier claims. The EU is working to formalize its commitments on tariffs and market access, though disputes remain over timing and sector-specific carveouts, particularly for autos, steel, and pharmaceuticals. Canada is also seeking relief from U.S. tariffs on metals and other goods, even as it prepares to drop some of its retaliatory duties under USMCA. Meanwhile, China is sending negotiator Li Chenggang to Washington for deputy-level talks after extending a truce on tariffs, though concerns linger over Beijing’s failure to resume U.S. soybean purchases. At the same time, Chilean officials say their negotiations with the U.S. are in their final stages. The uncertainty over details and implementation highlights both the scale of Trump’s trade ambitions and the difficulty of translating headline deals into binding agreements.
President Trump on Monday threatened new tariffs of up to 200 percent on Chinese imports if Beijing does not agree to ship magnets to the U.S., adding fresh tension to ongoing trade talks. While the U.S. and China confirmed in June that they had reached a framework deal on tariffs and critical minerals, final approval from both Trump and President Xi Jinping is still pending. Under the proposed deal, China would provide concessions on magnet and mineral exports, but the agreement remains incomplete. In the meantime, both nations have paused additional tariff escalations, with the U.S. maintaining 30 percent duties on Chinese goods and China keeping most levies at 10 percent. Trump also announced plans to impose tariffs and export restrictions on countries that enact digital taxes and regulations targeting U.S. firms, signaling potential disputes with Europe and others. Recent U.S.-EU trade frameworks have included digital trade provisions, though European officials insist these will not affect their digital services taxes or regulatory measures. The announcements highlight Trump’s dual strategy of pressuring China on minerals while challenging global digital trade policies he views as harmful to U.S. technology leadership.
President Trump said Monday that his meeting with South Korean President Lee Jae Myung did not change the trade deal the two countries reached last month, despite Seoul’s concerns and talk of renegotiation. Trump emphasized that South Korea would honor the agreement, which he described as massive, involving $350 billion in Korean investment in the U.S., $100 billion in U.S. energy purchases, and reduced U.S. tariffs of 15 percent on Korean goods. While details remain scarce and no joint statement has been released, Trump touted the deal as one of the largest ever, second only to his recently announced agreement with the European Union. The leaders also discussed shipbuilding and energy, with Trump hinting at U.S. plans to contract South Korean shipbuilders or bring them to America to help rebuild U.S. shipyard capacity. He further linked Korea’s energy commitments to an Alaska LNG pipeline joint venture involving both Korea and Japan. Although Trump initially warned he might halt business with Seoul over alleged misconduct at churches and a U.S. base, he later walked back the claim, calling it a misunderstanding. Lee refrained from raising renegotiation publicly and attributed the controversy to an investigation into former president Yoon Suk Yeol’s failed coup attempt.
The Trump administration recently allowed Nvidia and AMD to sell certain downgraded advanced chips to China in exchange for a 15 percent revenue fee, despite existing export controls. While administration officials argued these chips do not pose a national security risk, critics, including former officials and Democrats, disagree. In response, Rep. Raja Krishnamoorthi (D-IL), joined by Reps. Ami Bera (D-CA) and Jill Tokuda (D-HI), introduced the “No Advanced Chips for the CCP Act,” which would require both executive branch review and congressional approval before such sales could occur. The bill emphasizes preventing unilateral decisions and ensuring thorough scrutiny of potential risks to U.S. security and technological leadership. It mandates an interagency review involving the Commerce, Defense, Energy, and State Departments, along with the director of national intelligence, to assess risks such as military applications or human rights abuses. If a sale is approved, Commerce must provide Congress with detailed reporting before a joint resolution can authorize the export. Supporters argue the legislation is necessary to stop China from exploiting U.S. chip technology to advance surveillance, military, and AI capabilities.
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