The United States secured new framework trade agreements last week that will cut one of the highest country-specific tariff rates while allowing certain tariff exemptions for four countries in Central and South America. The announcements, reported by SupplyChainDive, came in the same week that the United States formalized a trade-related agreement with South Korea, strengthening the provisions of the framework agreement the two countries reached in July.
Read also: The United States announces trade frameworks with Argentina, Ecuador, El Salvador, and Guatemala
In a framework agreement with Switzerland and Liechtenstein, the United States said it would reduce the current 39% tariff on imports from Switzerland that have been in place since early August. The United States plans to cap tariffs on imports from Switzerland and Liechtenstein at 15%. Goods coming from Switzerland have been subject to a country-specific tax of 39% since August 7, when President Trump installed a slew of reciprocal tariffs.
If the deal is completed, the two European countries will eliminate tariffs on all American industrial goods, seafood and some agricultural products. The countries are also set to come together to invest $200.3 billion in the United States over the next five years, with Switzerland contributing $200 billion. A third of the investments are expected to be implemented in 2026.
Agreements in the Western Hemisphere
The White House also said it had concluded agreements with Argentina, Ecuador, El Salvador and Guatemala aimed at boosting trade and securing supply chains in the Western Hemisphere. The United States plans to finalize deals with the four countries in the coming weeks.
As part of a framework agreement with Argentina, the United States said it would eliminate reciprocal tariffs on “certain unavailable natural resources” as well as off-patent materials used in drug production. Argentina plans to expand market access to a range of US products, including medicines, chemicals, machinery, IT goods, medical devices, automobiles and a range of agricultural products.
The United States and Ecuador agreed to a framework for reciprocal trade that included Ecuador eliminating or reducing tariffs on agricultural exports to the United States. The South American country agreed to reduce or eliminate tariffs on tree nuts, fresh fruit, legumes, wheat, wine and distilled spirits. The United States and El Salvador have agreed to a reciprocal trade framework under which El Salvador commits to simplifying regulatory requirements and approvals for U.S. exports, including vehicles and auto parts manufactured in accordance with U.S. safety and emissions standards.
The United States and Guatemala have agreed to a reciprocal trade framework aimed at reducing trade barriers, supporting regulatory cooperation, and promoting agricultural trade. Guatemala agreed to address non-tariff barriers, including simplifying regulatory requirements and approvals for US pharmaceutical products and medical devices.
Source: Market intelligence platform IndexBox
