Trump's &#34;reciprocal tariff&#34; policy has finally been implemented, with Singapore emerging as the biggest winner in Asia with a 10% tariff rate, while Vietnam faces the highest value-weighted U.S. tariff rate globally. However, Barclays warns that the semiconductor and pharmaceutical industries face greater uncertainty.
According to CCTV News, on July 31 local time, Trump signed an executive order establishing the &#34;reciprocal tariff&#34; rates imposed on multiple countries and regions.
On August 2, according to the Wind Trading Platform, Barclays stated in its research report on August 1 that under the latest executive order, Singapore maintains a 10% tariff rate, becoming the biggest winner in Asia.
It is noteworthy that Barclays' analysis of the value-weighted U.S. tariff rates shows that Vietnam faces the highest value-weighted U.S. tariff rate globally.
However, Barclays also warned that the semiconductor and pharmaceutical industries face greater uncertainty. Although these industries are temporarily exempt from widespread tariffs, once industry-specific tariffs are imposed, the impact on Singapore, Malaysia, and Taiwan will far exceed that on other economies.
<h2>Final Tariff Rates Confirmed: Singapore Gains Competitive Advantage</h2>
The research report states that the specific tariff arrangements for Asian countries and regions under the latest executive order are as follows:
<blockquote>
Singapore 10%, Malaysia 19% (down from 25%), Thailand 19% (down from 36%), Pakistan 19% (down from 29%), Taiwan 20% (down from 32%), Sri Lanka 20% (down from 44%).
South Korea 15%, Indonesia and the Philippines 19%, Vietnam 20%, and India 25% remain unchanged.
</blockquote>
Barclays states that a punitive tariff of 40% will be imposed on goods identified as &#34;transshipment&#34; to evade tariffs, but specific identification criteria have not yet been published.
<h2>Value-Weighted Tariff Analysis: Vietnam Under the Most Pressure, Singapore Surprising</h2>
Barclays' analysis of the value-weighted U.S. tariff rates reveals the actual pressure faced by Asian countries and regions.
Value-weighted U.S. tariff rates (VA-weighted US tariff rates) measure: the weighted average tariff rate of a country or region's &#34;economic contribution&#34; exposed to different tariff levels in exports to the U.S.
It is reported that the ordinary average tariff rate does not consider trade structure: for example, some products may have a very low export volume but a high tariff rate, distorting the average. Value-weighted tariff rates more accurately reflect the impact on the economic value of domestic industries, rather than simply looking at the product level.
Barclays has re-estimated the region's &#34;value-weighted U.S. tariff rates&#34; based on the latest tariff rates, specifically:
<blockquote>
Vietnam has the highest value-weighted U.S. tariff rate globally at 2.3%, followed by Thailand, Malaysia, and South Korea, all in the range of 1.0-1.4%.
</blockquote>
Barclays' analysis shows that export-oriented Asian economies have greater exposure to U.S. tariffs:
<blockquote>
Vietnam has a domestic value-added (VA) exposure of up to 15.1% directly affected by U.S. tariffs on exports; Thailand 9.0%; Malaysia 8.7%; South Korea 6.9%; Singapore 6.8%.
In contrast, the risk exposure for the Philippines (3.1%), Indonesia (2.3%), and India (2.0%) is relatively small.
These figures indicate that a significant portion of the &#34;real economic value&#34; in these countries and regions relies on the sales of taxed products in exports to the U.S. In other words, if the U.S. continues to increase or expand its tariff list, they will be the first to be impacted.
</blockquote>
Barclays specifically pointed out that, surprisingly, the value-added weighted U.S. tariff rate for the extremely open Singapore is only 0.5%, which is relatively low. This is because most of Singapore's exposure to U.S. tariffs comes from the semiconductor and pharmaceutical industries, which are currently exempt from widespread tariffs.
<h2>Semiconductor and Pharmaceutical Tariffs: Potential Greater Risks</h2>
Barclays warned in its research report that while the current tariff arrangements are clear, the potential tariff threats facing the semiconductor and pharmaceutical industries should not be overlooked.
According to previous reports, U.S. Secretary of Commerce Gina Raimondo announced on the 27th local time that the Trump administration will release the results of a national security investigation into semiconductor imports within two weeks. This statement has raised market concerns about a new round of chip tariffs being imminent.
This investigation, based on Section 232 of the Trade Expansion Act of 1962, could lay the groundwork for imposing new tariffs on chip imports. The Trump administration has repeatedly used such trade investigation tools to implement tariff measures across multiple industries.
Barclays noted that for Singapore, pharmaceutical tariffs pose a special threat. If pharmaceutical tariffs are imposed at the 200% rate previously threatened by Trump, it would severely impact Singapore, as pharmaceuticals are a significant component of Singapore's trade with the U.S.
According to CCTV News, Trump stated in early July that the U.S. would soon impose tariffs of up to 200% on pharmaceuticals but would give pharmaceutical companies at least a year to relocate their supply chains back to the U.S. before the tariffs take effect.
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Trump's "reciprocal tariff" policy has officially been implemented, with Singapore emerging as the biggest winner in Asia with a 10% tariff rate, while Vietnam faces the highest value-weighted U.S. tariffs globally. Barclays warns that the semiconductor and pharmaceutical industries face greater uncertainty and may be affected by future sector-specific tariffs. Singapore's competitive advantage is evident, and other countries such as Malaysia, Thailand, and Taiwan have also adjusted their tax rates

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"Reciprocal Tariffs" implemented, Singapore is the biggest winner in Asia, Vietnam is the loser, but the tariff risks for semiconductors and pharmaceuticals are greater