August 1st is the deadline Donald Trump set for hiking tariffs with U.S. trading partners. The current trade deal between the U.S. and South Korea could cost Alabama consumers close to a billion dollars. The website Observatory of Economic Complexity says the state imported close to six billion dollars in goods from South Korea last year. If the fifteen percent tariff is tacked onto that figure on items entering the U.S., and the cost passed to Alabama consumers, the total increase would reportedly be close to a billion dollars.
Trump on Wednesday said the U.S. reached a deal to would impose a 15% tariff for goods from South Korea. The two countries have also agreed for South Korea to buy $100 billion in energy resources from the U.S. and for South Korea to give to the U.S. $350 billion for “investments owned and controlled by the United States, and selected by myself, as president,” Trump said.
South Korean president Lee Jae Myung later added that the $350 billion investment fund is meant to solidify a foundation for bilateral cooperation on strategic industries — noting that the fund will support South Korean companies' entrance to the U.S. market in areas such as shipbuilding, semiconductors, secondary batteries, biotechnology and energy.
The U.S. and the EU announced a trade framework that imposes 15% tariffs on most European goods — warding off Trump’s most recent threat of 30% if no deal had been reached by August 1st. But some key details require more work. The headline of the agreement, unveiled July 27, is that the 15% tariff rate will apply to 70% of European goods brought into the U.S. — with the EU later confirming that that rate applies to pharmaceuticals, semiconductors, and car and car parts. But the remaining 30% of those imports is still open for negotiations.
APR previously reported how Mercedes Benz, which operates its North American production plant near Tuscaloosa, is partially shielded against tariffs because of its U.S. connection. However, the European automaker says the cost of its cars would increase substantially, but not immediately. The Associated Press reports, by contrast, European car company Volkswagen is facing about one and half billion in extra costs due to tariffs.
European Commission President Ursula von der Leyen said that both sides had agreed to zero tariffs for a range of “strategic” goods. Meanwhile, Trump pointed to heightened investments from European companies in the U.S. — including what Trump said was $750 billion worth of natural gas, oil and nuclear fuel over three years, as well as an additional $600 billion under a political commitment that isn’t legally binding, officials said.
On July 22, Trump announced a trade framework to impose 15% tariffs on Japan — down from his previously-threatened rate of 25%. The U.S. president also said Japan would invest $550 billion into the U.S. and would “open” its economy to American autos and rice. The newly-agreed on 15% tariff rate also applies to Japanese cars — marking a welcome relief for automakers like Toyota Motor Corp. and Honda — which, like other automakers, have faced a 25% levy on key parts and finished vehicles going into the U.S. since earlier this year. But car companies in other countries, including U.S. competitors, worry that this could put them at a disadvantage.
Here in Alabama, the Observatory of Economic Complexity says the state imported close to $40 billion dollars in Japanese goods in 2024. Again, if the cost formula is applied where tariffs on imported items are paid here in the U.S. and those costs passed along to consumers, the hike for what Alabama imports would be $6 billion dollars
