Guyanese government seeks clarity on new 38 per cent tariff

    
Stabroek News reported on April 3 that the United States yesterday
imposed a 38 per cent tariff on goods exported from Guyana which will include seafood and other items and the Guyanese government here said it will engage with Washington to better understand the issue.


The announcement was made by President Donald Trump at the White House as part of what he called a “liberation day” for American trade.

A tariff is a duty imposed by a government on imported goods, making them more expensive in order to protect domestic industries or retaliate against unfair trade practices. Guyana’s largest exports to the U.S. include crude petroleum, gold, rice, fish, timber, and sugar.

In response to the tariff announcement, the Government of Guyana issued a terse statement acknowledging the new duties and confirming that it is in active discussions wth U.S. officials to better understand the decision and seek a resolution.

“The Government of Guyana has taken note of the reciprocal tariffs announced by the U.S. government. Our government is closely engaged with our U.S. partners to better understand the issue and have it addressed as appropriate,” the statement read.

The White House yesterday listed Guyana’s tariff on US goods at 76 per cent

In an invited comment, commentator Christopher Ram told Stabroek News: ”The 38 per cent tariff announced by President Trump on imports from Guyana ranks among the highest imposed globally, with only a few countries, such as Lesotho and Saint Pierre and Miquelon, facing steeper rates. The information released by Trump indicates that Guyana charges an average rate of 76% on imports from the U.S. President Trump will reciprocate with half of that average. The 76% figure is questionable since no charge is made on fuel. We share a Common External Tariff (CET) and VAT structures with other CARICOM countries and yet they face only a 10 per cent tariff.

“Both the Government and the private sector need to address this apparent and unfair anomaly with the US Embassy in Guyana and Washington.

“Our country is not particularly skilled in statistics, but the Budget Speeches often highlight our exports of seafood, certain agricultural products, rum and gold. I understand that the Beharry Group exports pasta products and spices. If this 38% rate stands, these sub-sectors will be severely affected with implications for growth, exchange earnings and employment.

“Coming shortly after our country’s declaration of strong bonds with the USA, the announcement is likely to rattle and upset the Government”.

Trump’s tariff package represents one of the most significant trade policy shifts in decades.

During his address, he described the new tariffs as “kind” reciprocal measures, arguing that, while steep, they remain lower than what some countries charge the U.S. Guyana, for instance, currently imposes a 76 per cent tariff on American goods, which appears to have influenced the 38 per cent tariff decision.

Forbes reported that other Caribbean nations, such as Trinidad, Suriname, Belize, Barbados, Antigua and Barbuda, Saint Kitts and Nevis, Grenada, Saint Vincent and the Grenadines, and Saint Lucia, saw tariffs of 10%, reflecting their lower duties on U.S. imports. Larger economies like China faced one of the highest tariffs at 34 per cent, which, combined with existing duties, brings the total tariff on Chinese imports to 54 per cent. The European Union was hit with a 20 per cent tariff.

According to a Reuters report, the new tariffs are part of a broader strategy to erect trade barriers around the world’s largest consumer economy, reversing decades of trade liberalization. Trading partners are expected to retaliate with countermeasures, potentially causing significantly higher prices for products ranging from bicycles to wine.

“It’s our declaration of independence,” Trump said in the White House Rose Garden. He displayed a poster listing reciprocal tariffs, including 34% on China and 20% on the European Union, as a response to duties placed on U.S. goods.

The announcement has caused uncertainty, rattling financial markets and businesses that have relied on longstanding trading arrangements. Although the administration stated that the tariffs would take effect immediately after Trump’s announcement, the official notice required for enforcement has not yet been published. However, an official notice was issued for a separate set of tariffs on auto imports, which are scheduled to take effect on April 3.

Trump has already imposed a 20% tariff on all imports from China, along with 25% tariffs on steel and aluminum, which have been extended to nearly $150 billion worth of downstream products. His advisers argue that these measures will restore vital manufacturing capabilities to the U.S.

However, outside economists warn that such tariffs could slow the global economy, increase the risk of a recession, and raise living costs for the average U.S. household by thousands of dollars annually. Businesses have expressed concerns that the barrage of threats makes it increasingly difficult to plan their operations.

This new tariff package builds on previous measures introduced by Trump during his early months in office, which included a 25% tariff on auto imports, a 25% tariff on steel and aluminum, and a 25% tariff on non-USMCA products from Canada and Mexico.

Trump’s latest move escalates the trade war that began upon his return to the White House, expected to disrupt global trade, increase prices for U.S. consumers, and provoke retaliatory measures from trading partners. Financial markets reacted sharply, and U.S. stocks have lost nearly $5 trillion in value since February, as investors grow increasingly anxious about the mounting trade uncertainties. Businesses, especially those relying on international supply chains, have voiced concerns about the difficulty of planning for the future.

Economic experts warn that the tariffs could slow global growth, raise the risk of recession, and increase the cost of living for U.S. households. However, Trump’s advisers insist that the tariffs are necessary to bring key manufacturing industries back to the U.S.

As one of Guyana’s largest trading partners, the U.S. tariffs will significantly impact Guyana’s local export industries.

The White House defended the move, in a statement on their website stating that “foreign trade and economic practices have created a national emergency. Trump invoked his authority under the International Emergency Economic Powers Act of 1977 (IEEPA) to impose these responsive tariffs, aimed at strengthening the U.S. economy and protecting American workers”.

Under the new order, a 10% tariff on all countries is set to take effect on April 5, 2025, at 12:01 a.m. EDT. Countries with the largest trade deficits with the U.S. will face individualized reciprocal higher tariffs, which will take effect on April 9, 2025. These tariffs will remain in effect until Trump determines that the trade deficit and underlying nonreciprocal treatment are resolved.

Certain goods, including strategic minerals, pharmaceuticals, semiconductors, steel, aluminum, and autos already subject to other tariffs, will be exempt from the reciprocal tariff. USMCA-compliant goods from Canada and Mexico will continue to face a 0% tariff, while non-compliant goods will incur a 25% duty.

Trump defended the new measures, saying that access to the American market is a privilege, not a right. He emphasized that reciprocal tariffs were a key promise of his campaign and central to his broader economic agenda, which includes energy competitiveness, tax cuts, and deregulation.

His administration cites studies suggesting that tariffs reduce imports, boost U.S. production, and do not significantly raise prices for consumers. However, economists continue to warn that these tariffs could have broader negative effects on global economic stability.

On the 248th anniversary of the independence of the United States on June 27th last year, US Ambassador Nicole Theriot had lauded the growth in trade relations.

“Just a few years ago, we traded a few $100 million US worth of goods, but last year, we surpassed $4.6 billion US! We now have over 100 U.S companies in Guyana, and that number is growing every day. Through trade missions, conferences, and exchanges between our private sectors, our companies are unleashing economic growth that supports the employment of thousands, providing a better future for Guyana. And it is occurring in many sectors,” Theriot said.

Article Source: Stabroek News