US President Donald Trump is rebuilding his tariff strategy using traditional trade laws after a Supreme Court setback, imposing new duties on 60 countries over forced labor enforcement. As reported by Reuters, Trump's latest global tariff salvo includes duties of 10% or 12.5% on 60 countries over allegedly weak enforcement of forced-labor bans, marking the first of numerous tariff actions to be unveiled in the months ahead. The new duties almost directly replace a global 10% temporary tariff that expired on Friday, covering 99.4% of U.S. imports according to the U.S. Trade Representative's office. This rebuilds part of Trump's signature 'Liberation Day' tariffs of 10%-50% on nearly every country, which the Supreme Court struck down as illegal under an untested national emergencies law Trump used to impose them.
Despite the new measures, OCBC Bank Malaysia expects exports from the region to remain resilient, supported by extensive product exemptions and relatively low effective tariff rates. The bank noted that the latest tariffs effectively replace the "reciprocal" tariffs previously struck down by the US Supreme Court earlier this year, reducing the overall shock to exporters. Singapore enjoys the lowest effective tariff rate at 6.1%, followed by Malaysia at 8.1%, India at 8.2%, Thailand at 8.3%, the Philippines at 10.7%, Vietnam at 11.2% and Indonesia at 13.6%. Based on 2025 trade data, approximately 68.1% of US imports from Singapore remain exempt, followed by the Philippines (65.7%), Thailand (63.7%), Malaysia (63.1%), India (54.4%), Vietnam (53.9%) and Indonesia (21.7%). Countries that have implemented or committed to enforcing bans on imports produced with forced labor, including Malaysia, India and Indonesia, face a 10% tariff, while the remaining economies are subject to a 12.5% rate.
The Trump administration is conducting ongoing investigations into excess industrial capacity, targeting 16 big trading partners including China, the EU, Japan, South Korea, Mexico and Vietnam. As reported by Reuters, Trade Representative Jamieson Greer has said the layers of tariffs being rebuilt will not exceed caps included in deals he has been negotiating, including 15% for the EU, Japan and South Korea and higher rates for Southeast Asian countries. Administration officials indicate that even though China is viewed as the world's largest source of excess manufacturing, its rates will not exceed the cap of about 20% agreed by Trump and Chinese President Xi Jinping last November. The investigations include probes into excess industrial capacity, alleged intellectual property theft by Vietnam, and national security protections for strategic industries from semiconductors to robotics and industrial machinery.
In response to the intellectual property claims, Vietnam has toughened enforcement, which it outlined in a submission to the US Trade Representative after it was labeled a 'priority foreign country' in an April report. As reported by Business Standard, the 3,581-page document highlights nearly 20,000 infringement cases that authorities handled between 2021 and 2025. Vietnam was among 60 economies hit with new US tariffs Friday because the US said it had failed to do enough to prevent forced labor in their supply chains, with Vietnam's foreign ministry saying the decision doesn't 'fully reflect the reality and Vietnam's efforts in preventing, reducing, and eliminating forced labor.'
Recent trade data reveals that US goods trade deficit was $101.5 billion in June, down $4.4 billion from $105.9 billion in May, with exports of $204.7 billion and imports of $306.2 billion. According to Investing.com India, corporations rushed to beat Trump's reciprocal tariffs in late 2024 and early 2025, causing imports to surge, but by mid-to-late 2025 and early 2026, imports fell as stock inventories were high. The current goods trade deficit is worse than every month but one between June 2022 and March 2025. Tariffs have done nothing to improve trade deficits but they sure have increased costs, as noted by market analysts. The Trump administration's broad use of Section 301 in forced-labor cases has prompted immediate legal challenges by small businesses, though trade experts say this will take time to play out and judges may be reluctant to enjoin actions aimed at curbing forced labor.
