ECONOMYNEXT – The United States will send letters within the next two to three weeks to trading partners setting out a tariff decision as it was not possible to meet all the countries, President Donald Trump said.
Sri Lanka was one of the few dozen countries that met the United States. Sri Lanka has tried to make a case that each country should be treated the same and not widely differing tariff rates which will make it difficult to compete.
“We have, at the same time, 150 countries that want to make a deal, but you’re not able to see that many countries,” Trump said at a business meeting in Abu Dhabi Friday.
“So at a certain point, over the next two to three weeks, I think Scott and Howard will be sending letters out, essentially telling people – we’ll be very fair – but we’ll be telling people what they’ll be paying to do business in the United States.
‘I guess you could say they could appeal it, but for the most part, I think we’re going to be very fair, but it’s not, it’s not possible to meet the number of people that want to see us.”
Trump has toured several stable countries in the Middle East which have currency board like regimes (fixed exchange rates with high credibility) governed by strong laws and no policy rate, to make it difficult to operate discretionary or ‘flexible’ exchange rates.
The countries have economic and policy stability as macro-economic policy is outlawed and the International Monetary Fund nor macro-economists have the legal power to do aggressive open market operations, trigger forex shortages and de-stabilize the nations.
Trump has so far visited the Kingdom of Saudi Arabia, the first nation in the Gulf region to go for a currency board style regime in 1960 (Saudi Arabia Monetary Agency) after severe currency instability in the 1950s, followed by Qatar and Dubai.
The SAMA was set up by a Royal decree on the advice of Arthur N Young, an American money doctor in October 1952, to target and exchange rate at 3.70 to the US dollar by Royal Decrees No (30/4/1/1046) and (30/4/1/1047).
In the mid 1950s Saudi Arabia suffered severe monetary problems after the agency was authorized to buy government debt. In 1960 it was reformed to currency board like arrangement by Decree No 6 requiring Riyals to be fully backed by foreign reserves or gold.
Without macro-economists to reject classical economic principles and run ‘monetary policy’ the Riyal is still 3.75 to the US dollar today.
READ MORE: History of the Saudi Arabia Monetary Agency
Qatar and Dubai set up a joint true currency board in June 1966 with support from the SAMA which supplied notes to replace the Indian rupee, a few days after macro-economists destroyed the Indian rupee to finance Nehru’s 5-year plans and devalued it.
Most Gulf countries which came under British influence after World War I, were ‘dollarized’ with the Indian rupee with some other currencies playing minor roles.
Saudi Arabia, Dubai and Qatar do not have ‘independent’ monetary policy policy, but their economic and political independence has been assured by keeping activist macroeconomists out of their monetary authority.
However analysts say if the countries fall victim to ‘monetary policy modernization’ they could collapse like Yemen – which also had a currency board like the UAE – if the operating framework changed.
The SAMA re-named itself Saudi Arabia Central Bank in 2020 but has not yet started active monetary policy to trigger currency crises.
The currency board like regimes which have free trade have only attracted 10 percent tariffs from President Trump. (Colombo/May16/2025)