The US is initiating a new phase in its trade policy by implementing a reciprocal tariff structure. President Donald Trump has announced that starting from 4 July 2025, formal letters will be dispatched to foreign governments, delineating the specific tariff rates to be imposed on imports into the US.

This development signifies a departure from the previous approach of crafting multiple individual trade agreements.

Citing the complexity of negotiating with more than 170 countries, President Trump expressed a preference for a reciprocal tariff framework. The letters will be sent in batches to ten countries at a time, with anticipated tariff rates ranging from twenty to thirty percent.

On 2 April, President Trump had initially unsettled markets with the introduction of sweeping reciprocal tariffs varying between 10%  and 50%. However, he subsequently imposed a temporary cap at 10% for most countries until 9 July to allow for negotiation.

Despite this grace period, many nations have not commenced formal trade discussions with the Trump administration, with the exception of Britain. In May, Britain secured a deal to maintain the 10% rate and obtained preferential terms for critical sectors such as automotive and aircraft engines.

Basware chief revenue officer Mark McCarthy said: “Trade wars and tariff uncertainty introduce volatility into the global economy. For major enterprises, especially those with complex supply chains or international footprints, this creates hesitation around IT spending. CIOs and CFOs may want to delay large IT investments, reassess strategic priorities and scrutinise every dollar of spend.”

In the face of economic uncertainty, companies are stated to be strategically investing in essential financial operations that provide minimal implementation risk while delivering measurable, rapid returns. Accounts Payable automation is claimed to be crucial for preserving supplier relationships during volatile periods, as they can be particularly sensitive to payment timing.

Research indicates that up to 90% of businesses pay suppliers late, but automation can cut invoice processing time from an average of ten days to less than four, aiding in timely payments to suppliers who experience their own cash flow issues due to broader economic strains.

Negotiations with major trading partners have resulted in varying tariff rates, with the European Union facing 20%, India 26%, and Japan 24%.

Conversely, countries that have not engaged in talks are subject to more severe tariffs, with Lesotho at 50%, Madagascar at 47%, and Thailand at 36%.

Napier AI compliance expert Michael Joseph said: “Tariffs create a breeding ground for financial crime. Fluctuating tariffs, while designed to serve economic and national security objectives, have created unintended consequences. As supply chains reorganise in response, new vulnerabilities for money laundering and other financial crimes have emerged. Our research shows that money laundering and terrorist financing cost the US economy over $600bn per year on average.”

 “Tariff differentials between countries create strong incentives for trade diversion and misrepresentation. When goods face a 10% tariff from one country but potentially up to 145% from another, criminal organisations can exploit these differences through invoice manipulation, falsifying country of origin documentation, or routing shipments through third countries to conceal their true origin. These techniques are hallmarks of trade-based money laundering but can become more difficult to detect during periods of extreme volatility.”

Recently, President Trump confirmed a new trade deal with Vietnam, reducing tariffs on Vietnamese goods from 46% to 20% and granting duty-free access for a broad array of American exports.