Chartered Accountant Terrence Jaskaran has commended Guyana’s move to engage the United States Government for further information on its 38 per cent reciprocal trade tariff.
In an interview with Ignite News today, Jaskaran highlighted the US’s “clear-cut” intention to revitalise its manufacturing sector and increase exports by imposing global and reciprocal tariffs aimed at reducing large trade deficits, such as the USD $1.2 trillion recorded last year.
Guyana was identified as having high trade surpluses, with two-way trade last year showing the country recorded an almost US$2 billion trade surplus over the US.
Jaskaran outlined several options Guyana could utilise to address the tariff but noted the potential negative impacts, particularly given that the US is a major trading partner.
“Some have suggested that Guyana could seek to retaliate with tariff increases of its own on US imports. However, this would be ill-advised, as it would mean an increase in the cost of US goods entering the Guyanese market. This cost would, in turn, be passed on to Guyanese consumers, resulting in price increases.”
“Additionally, if those imports are raw materials, then it would lead to increased production costs in a local market that already experiences high costs. This would make our locally produced goods—both for export and domestic use—less competitive price-wise.”
Jaskaran continued that, unlike economic powerhouses that have sought to fight ‘fire with fire’ by imposing tariffs of their own on US-made imports, Guyana is in no position to do the same.
This would, among other issues, cause increased consumer prices in both countries, as the costs of the tariffs are passed on to consumers.
“As such, the position taken by the Government in dealing with this matter is perhaps the best at this moment. While other sections in the political sphere may be critical of the Government—especially during this time—the comments made by the Finance Minister, Dr Ashni Singh, should be appreciated. Engaging the US Government, gaining a better understanding of the issue as a whole, and then responding appropriately, is undoubtedly the best step forward.”
The accountant suggested that, ultimately, Guyana may look to reduce its Common External Tariff imposed on US imports, in the hope that the US reciprocates by reducing the newly imposed tariffs.
