Current US tariff rates significantly vary across trading partners and industrial sectors, and that could have a major bearing on the impact of potential changes in the country’s tariff policy this year, according to Fitch Ratings.
The effective tariff rate on all US goods imports (import duties as a share of total goods imports) averaged 2.3 per cent in 2023, ranging from 0.1 per cent for oil and gas products to 12.4 per cent for textile products.
The average US effective tariff rate is projected to rise to 7.9 per cent, assuming that dutiable rates increase to 60 per cent on China, 25 per cent on Mexico and Canada, and 10 per cent on other trade partners.
The dutiable tariff rate (duties as a share of dutiable imports) was 7.4 per cent on an average, reflecting the fact that only 32 per cent of total US goods imports were subject to duties. The highest dutiable rate was in textiles at 15.7 per cent, the rating agency said in a release.
Fitch’s global economic forecasts assume the average US effective tariff rate will increase to 7.9 per cent, based on the assumption dutiable rates increase to 60 per cent on China, 25 per cent on Mexico and Canada, and 10 per cent on other trade partners.
If these rates are levied on all imports from China (60 per cent tariffs), Mexico (25 per cent), Canada (25 per cent) and others (10 per cent), the effective rate will increase to 21 per cent, Fitch added.
Fibre2Fashion News Desk (DS)