Guyana urged to approach US tariffs with caution

Financial Analyst, Joel Bhagwandin has urged caution in the way Guyana and its regional partners respond to the United States recent tariffs on imports entering that country.
The US’s Donald Trump administration on Thursday slapped massive tariffs on several countries in what he described as America’s “liberation day” in trade.
Guyana was hit with a reciprocal tariff of 38 per cent, much higher than the 10 per cent tariff allotted to several other Caribbean nations.
Bhagwandin noted that a more in-depth look at the situation will be useful for Guyana before the country acts, particularly where retaliatory measures are concerned.

“In Guyana’s case, a retaliatory response may not necessarily be the desired approach since import duties and VAT are applied to US imports. While I appreciate this is a complex issue and would require far more in-depth analyses, we can nonetheless construct a simple scenario analysis to understand the implications and issues of fairness in the application of the 38 per cent US tariff,” he said.
Bhagwandin explained that Guyana’s Common External Tariff (CET) rate ranges from five per cent to 20 per cent, a tariff rate of 40 per cent on agricultural products and duties that attract 14 per cent VAT equally applied to imports and locally produced goods and services, with exceptions to certain green technologies.
He explained further that Guyana has no blanket rate of CET applied to US imports, and contended that the various rates could have little to no impact, or place Guyana in a worst position.

As for CARICOM, he said that the issue would have varying degrees of impact for regional nations, which would require them to examine the matter individually and as a bloc to assess impacts, implications and responses, and not necessarily to form retaliatory measures.
“With that in mind Guyana and the CARICOM region would have to perform firstly a more thorough analyst to understand the full implications and would have to consider a general revision or reduction of current CET rates that apply with the view that the US would reciprocally reduce their tariff rates applicable to Guyana and the region,” Bhagwandin advised.
The United States is the leading trade and investment partner for Guyana. According to the US Department of Commerce’s 2023 bilateral trade report, two-way trade reached approximately $4.5 billion, with Guyana enjoying a surplus of nearly $2 billion.
Major US exports to Guyana included machinery, petroleum products, fabricated metal products, chemicals and computer and electrical products, the US Embassy in Georgetown said.
Major Guyanese exports to the United States included oil and gas, minerals and ores, primary metal manufactures, and processed foods.