Gita Gopinath

Pleasure to join you, Kai.

So that's a great question.

And what we find is basically that the actual tariff rates, which is the rates that U.S.

importers are paying at the border, is about half of the statutory rates or the rates that have been announced previously.

So while the statutory rate is around 27%, the actual rate is closer to 14%.

And the reason for that difference is because there are numerous companies and products that have been basically taken off the list of tariffs, and that's lowered the average tariff rate.

So if your goods are already on a ship,

on water at the time when the tariff comes into play, then you are not subject to that tariff rate.

So it's only imposed on goods that have yet to leave a foreign shore.

So there are about three or four months, especially if you are a product that takes a while to get shipped from a foreign destination to the U.S., then you are also then exempt from that tariff.

That is correct.

So if you look at...

trade between, for example, Mexico and the U.S.

Before the tariffs got announced, about 50% of imports from Mexico came in, you know, checking the box that it was USMCA tariff.

And that number has now jumped to 80% because people said, okay, well, we're going to do the paperwork to get this done because it's a huge difference in cost.

Well, what we've seen recently actually is the Trump administration cutting back some of the tariffs, right, on food like beef and coffee and so on, because it is actually affecting people's cost of living.

Again, a lot depends on what happens after the Supreme Court decision and how they decide to react to that.

But what we're seeing in terms of this gap seems like something that could be quite resilient, right?

I think the first question we had was, what exactly is the tariff rate of the US?

Usually in the past, this is a fairly uninteresting question because there's very few changes in tariff rates and it's easy to just download from any site.