ECONOMYNEXT – President Donald Trump has said he will he will likely send letters from Friday (Washington time) setting out import tariffs of 20 to 25 to 30 percent instead of haggling over individual items in complex trade agreements as Sri Lanka hopes to lower a 44 percent proposed levy.
“My inclination is to send a letter out and say what tariff they’re gonna be paying. It’s just much easier,” Trump told reporters.
“We have far more than 170 countries, and how many deals can you make? And you can make good deals, but they’re very much more complicated.”
“Its just so many countries. And then they go specific. Let to this, lets do that. Beef, ethanol… (makes a face). I’d rather do a simple deal, where you can maintain it and control it. You are going to pay 20 percent or 25 percent or 30 percent tariff.
“And we are probably going to send letter tomorrow (evening Friday Sri Lanka time), may be 10 a day to various countries saying what hey are going to pay to do business with the US.”
The US has already imposed a 10 percent minimum tariff on countries with a trade surplus which Sri Lanka is paying with the 44 percent rate suspended till July 09.
It is not clear what Sri Lanka can get. Sri Lanka negotiators have been negotiating to get which will not put it at a disadvantage when compared to competitors like India, Bangladesh and East Asian nations.
“We have an expectation from our side that we can get some amendment of the tariff to minimise the effect on the economy and our exporters as a result of interventions the government has made,” Cabinet spokesman Nalinda Jayatissa said Wednesday.
There have also been expectations of a extensions of the 10 percent in the case of countries that were already negotiating with the US in ‘good faith’ if President Trump decides according to a statement of US Treasury Secretary Scott Bessent.
The International Monetary Fund has said Sri Lanka’s economic output could be hit as much as 1.5 percent, depending on how bad the relative tariff is.
Vietnam, which promised duty free entry to American goods and also indicated that they will buy a nuclear reactor and jets, has got a 20 percent rate, according to a social media post.
China has got 35 percent not counting some other specific tariffs, which may put the rate up to 55 percent.
Countries with higher productivity can cope with higher levels of tariffs. (Colombo/July05/2025 – Updated IV)