As US President Donald Trump's widest-ranging tariffs to date took effect Saturday, the White House said it had lowered planned levies on two French overseas territories. Trump's move has already triggered retaliation and economists fear a major upset to the global economy.
In a list of countries and territories published Wednesday, the Trump White House had said it would slap duties of 37 percent on imports from Indian Ocean territory La Reunion and 50 percent on those coming from tiny Saint-Pierre-et-Miquelon in the north Atlantic.
La Reunion (Reunion Island) – part of the European Union's shared customs area, but considered a separate territory for tax purposes – will instead face a 10-percent tariff, according to a version of the list made available Friday.
Saint-Pierre-et-Miquelon – technically not part of the European Union – will be hit with the same levy.
That would bring the two territories into line with other French overseas territories Guadeloupe, Martinique, French Guiana and Mayotte.
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La Reunion's regional president Huguette Bello had blasted Trump as "ignorant" on learning of the initial tariff rate Wednesday, while Saint-Pierre-et-Miquelon MP Stephane Lenorman attacked "incompetence in the American administration."
The Friday version of the list also saw planned tariffs on Australia's Norfolk Island, which lies between New Zealand and French Pacific territory New Caledonia, sharply reduced.
The island – population 2,000 – had initially been slated to face import duties of 29 percent, now reduced to 10.
Ten percent baseline tariff
These modifications came as a 10 percent "baseline" tariff came into place on Saturday, hitting most US imports except goods from Mexico and Canada.
Trump has invoked emergency economic powers to address perceived problems with the country's trade deficits.
The trade gaps, said the White House, were driven by an "absence of reciprocity" in relationships and other policies like "exorbitant value-added taxes."
EU readies response to new US tariffs, France braces for fallout
Next Wednesday rates will be increased for dozens of US trade partners, with EU importers set to pay 20 percent and China 34 percent.
China announced its own 34-percent tariff on US products from 10 April and said it would sue the United States at the World Trade Organization and restrict export of rare earth elements used in high-end medical and electronics technology.
On the stock market, Wall Street went into free fall, following similar collapses in Asia and Europe.
The Dow Jones dropped 5.5 percent and the S&P 5.97 percent.
US Federal Reserve Chairman Jerome Powell warned the tariffs were likely to spur "higher inflation and lower growth."
Losses in US financial markets were estimated at more than $6 trillion since Trump unveiled his "Liberation Day" tariffs on Wednesday.
(with AFP)
