Three More Weeks of Tariffs Turmoil
July 10, 25
It's complicated trying to piece together the tariff jigsaw puzzle.
Every time it looks like it's coming together, Trump makes another announcement, sends out some letters or adds a new post, with lots of shouty CAPITAL LETTERS, to his Truth Social online platform.
This a huge source of frustration and anxiety for a diamond industry that has already been battered by Covid, the global downturn and lab growns.
It's not easy to make sense of something with so many moving parts, but here, hopefully, is a clear account of how the US tariff story has unfolded so far and how things now stand (as of 10 July, but subject to change at any moment).
On 2 April US President Donald Trump made his bombshell announcement of reciprocal tariffs on 57 countries, of up to 50 per cent.
He regards them as a threat to national and economic security because they export too much to the US and import too little.
A week later, on 9 July, he introduced a 90-day pause on these newly-announced reciprocal tariffs, although the 10 per cent baseline element of those tariffs still applies.
The pause was designed to force US trading partners to the negotiating table, but with limited success.
Vietnam managed to reduce tariffs from 46 per cent to 20 per cent and the UK reached a complicated agreement tying tariffs to quotas, largely related to steel and car exports.
The plan then was that 9 July would be the deadline for negotiations, and the tariffs would come into force on 1 August.
On 28 May the United States Court of International Trade ruled Trump had overstepped his authority by using emergency powers to impose the tariffs.
Later the same day a higher court, the United States Court of Appeals for the Federal Circuit, issued a stay - which is still in force - while it considered the appeal, allowing the tariffs to remain in effect.
Then on Monday of this week (7 July) Trump made two announcements. First, he extended the deadline for negotiations until 1 August. And second, like a teacher reprimanding a schoolchild for not doing their homework, he sent letters to 14 countries deemed to have made insufficient progress towards a deal.
Myanmar, Laos, Cambodia, Thailand, Bangladesh, Serbia, Indonesia, Bosnia and Herzegovina, South Africa, Japan, Kazakhstan, Malaysia, South Korea, Tunisia all received a stern reminder from Trump, restating their percentage tariffs.
The pressure is now on for those countries, and indeed for all countries except the UK and Vietnam, to reach agreement with Trump the dealmaker.
India, which exports 30 per cent of its diamonds and jewelry to the US, did not receive a letter.
It was working hard and as the clock ticked down the deadline it seemed as though it might just clinch a mini-trade deal. But it wasn't to be.
The tariffs will take effect on 1 August. Trump has made it very clear there will be no extension. The original plan allowed for a three-week window between deadline and imposition. Now there is no window.
The table below shows the current state of play for major diamond producers or manufacturers.
The diamond world faces another three weeks of uncertainty, balancing the possibility of a last-minute deal with the threat of a crippling (and some would say arbitrary) new burden.
Have a fabulous weekend.