Introduction
One day before Guyana observed Emancipation Day, the mercurial universe Boss Donald Trump confirmed his April 2 Liberation Day Executive Order to unilaterally impose tariffs on every country trading with the United States of America. The US President imposed on Guyana’s products entering the United States a 15% tariff beginning next week – a blow with implications for this country’s trade policy and its economic diversification programme. If one is looking for any consolation, maybe it lies in the initial implausible reciprocal rate of 38% previously announced in April, using an amateur’s methodology based on the size of the trade deficit which that country has with the United States. Thanks Exxon!
It is no consolation however that Guyana and Trinidad and Tobago all have a higher rate than the other countries of the Region, including all the CARICOM countries, Suriname, Cuba and Haiti. This appears a cautionary word to Guyana which has been cosying up to the Americans, accepting that the lopsided 2016 Petroleum Agreement will remain unchanged up to 2057, hosting its Secretary of State at a special function and tolerating its ambassador interfering in Guyana’s domestic affairs in an election season. It will take some time to see the economic consequences of Trump’s action which even questions the well-worn cliché that America does not have permanent friends, only permanent interests.
Strategic partner?
It is not as if Guyana is of no consequence to the United States. We are not only of strategic importance, sitting at the top of South America. Nor are we of no diplomatic value – we make our voice heard at the United Nations and are not ideologically at odds with the USA. Indeed, there is a view that Guyana is a compliant and accommodating partner. On the economic front, we have no equal among CARICOM states. In another few years, Guyana will contribute significantly to the energy security of the USA with around 600,000 barrels of oil per day earned by American giants Exxon and Chevron from the Stabroek Block. Does that not count for something!
This imposition is not an oversight. We have former President Sam Hinds heading our embassy in Washington. We have a highly paid lobbyist in that country, and we have in Georgetown an ambassador with whom we are obviously in contact. They have all failed us and the question we must ask – without getting any answers – is why has Guyana been excluded from the 10% club? By what measure could we be placed below Cuba and Haiti and on the same plane as Venezuela? What message are the Americans trying to send?
Despite the abundance of rhetoric about Guyana being “a strategic partner” or “the new frontier,” we remain little more than a resource basin, extracted by multinationals and then sidelined when broader trade benefits are being shared. This 15% tariff is not merely economic. It is a diplomatic signal that Guyana does not carry sufficient weight in U.S. trade calculations to warrant even the same treatment as Haiti or Saint Lucia. That is both alarming and deeply humiliating.
Question time
Even as we accelerate towards national elections, we expect our leaders and politicians to ask some searching questions. Did we request inclusion in the 10% group? Did we raise objections when the 15% classification was being drawn up? Were our diplomats even informed? This is no time for passivity. The 15% tariff decision is a clear sign that our foreign policy must be recalibrated. Our leaders must be willing to make meaningful, not symbolic representation.
Make no mistake: this has real economic consequences. Exporters of rice, rum, lumber, processed foods, and other non-oil products will now find their goods 15% more expensive in the U.S. market than similar products from Barbados or Jamaica. It undermines Guyana’s already fragile export base and disadvantages any attempt at economic diversification.
Even as we talk about building a manufacturing sector or value-added production, such efforts are directly harmed by this kind of tariff penalty. And since our oil exports are outside the scope of these tariffs, it is the non-oil sector – the very segment we claim to want to strengthen – that takes the hit.
Conclusion
We must now wait until the elections are over to address the issue and its consequences. Late as it is, we need to understand the rationale for the decision. There seems no reason why we do not call in Kingston for an explanation. The Ministry of Foreign Affairs must publish the timeline of its knowledge of this classification and the representations, if any, made to U.S. authorities. The Office of the President and Ministry of Finance must clarify how this tariff will impact exports and growth. And the Private Sector Commission must shake off its inertia and demand redress on behalf of the exporters it claims to represent.