The 10% base tariff (tax) imposed by the United States (US) President Donald Trump on exports from Papua New Guinea to the US market won’t have much impact locally in terms of costs of living, but a global recession is a big concern. The Papua New Guinea (PNG) Institute of National Affairs (INA) Executive Director Mr. Paul Barker in an interview with PNG HAUSBUNG recently revealed that tariff will have less impact because PNG exports less to the US market compared to what is imported from the US. Nevertheless, Mr. barker said these tariffs imposed by President Trump has created uncertainty. “It’s a time of uncertainty because the US administration is putting different levels of tariffs on different countries, They’re also modifying tariffs. So, after some negotiations or reactions from some of the other countries, they’re modifying some of those tariffs,” said Mr. Barker. He said this is making it very difficult for the other countries but also businesses to determine their way forward. “Now with Papua New Guinea, we have been given the lowest rate, so, before we had a zero tax on most things, but we’re now applied the 10%. So, that was the lowest rate, which is lower than the rate from some of the other countries that are exporting similar products as Papua New Guinea to the United States. ‘"The thing is PNG imports far more from the US than it exports to the US,” stressed Mr. Barker. The PNG exports are fairly limited to the US; there’s a little bit of agricultural produce that goes there. Mr. Barker said some of those exports are the A Grade coffee sold to the specialty coffee market in the US for a good price. Basically, he said it is not expected that the tariffs would directly have much of an impact on the costs of goods to be passed on to consumers in the country, no overnight price hikes. However, one of the effects of the tariffs is that it may well reduce the overall global level of trade and that can trigger both a recession within the US, because of the higher cost of living and trading, and across the whole world. ‘So, if you have a reduction in the overall economic activity worldwide, which is what a recession is, and people have less money, there is less jobs and that can mean they’ll be importing less. So, it reduces the overall economic opportunity that Papua New Guineans have for exporting a range of products, not just to the US, but to other countries as well," he said. He explains that if China becomes hard hit from the tariffs, China being a major market for some products export from PNG, they will have less money to buy, this then will affect PNG exports.