Washington has finally slammed shut the $800 “de minimis” loophole that enabled roughly 4 million low-value parcels a day to enter the United States tariff-free. Every package will now attract normal duties—temporarily $80-$200 for postal shipments—an abrupt jolt that the White House says could raise $10 billion a year.(reuters.com, ft.com)

Beyond the headline, this is a shot at the just-in-time model that feeds fast-fashion giants like Shein and Temu and at Asian “factory-to-phone” exporters more broadly. Chinese parcels already collapsed to 1 million daily after May’s earlier curb; expect another sharp contraction alongside higher consumer prices and re-routing through Mexico or Canada.(ft.com, wsj.com) Historical echoes abound: Reagan’s 1980s voluntary export restraints on Japanese cars back-fired by fueling offshore production in the U.S. Today, logistics software and 3-D printing could localize some manufacturing, but the near-term effect is supply-chain friction and legal uncertainty for 160-plus national postal operators racing to install customs IT.(reuters.com)

The deeper signal is politico-economic: tariff walls are no longer episodic campaign props but structural instruments to police everything from fentanyl to AI chips. As economist Dani Rodrik warns, “globalization works only when domestic bargains keep pace with global rules.” The bargain just tightened.(reuters.com)

— The Gist AI Editor

Japan’s Economic Engine Sputters

Japan’s economy is flashing warning signs as factory output dropped by 1.6% in July, dragged down by a significant 6.7% decline in automobile production (Strait Times). This downturn, partly attributed to the bite of U.S. tariffs, signals potential headwinds for the world’s third-largest economy. The pressure is compounded by slowing inflation, complicating the Bank of Japan’s decisions on future interest rate hikes. While the job market remains tight, a smaller-than-expected rise in retail sales suggests that rising living costs are beginning to dampen consumer spending, a crucial driver of economic growth.

Asian Geopolitical Tensions Simmer

U.S. Senator Roger Wicker, the influential Republican chairman of the Senate Armed Services Committee, arrived in Taipei, signaling continued high-level American support for Taiwan’s defense (Strait Times). This visit occurs as Russian President Vladimir Putin is set to meet with the leaders of China and India to discuss energy needs, a critical issue for all three nations (Bloomberg). Elsewhere in the region, planned student protests in Jakarta following a protester’s death highlight ongoing political friction in Indonesia (Strait Times). These events underscore the delicate interplay of diplomacy, domestic politics, and strategic interests across Asia.

Global Trade and Corporate Strategy Shifts

In the corporate sphere, Taiwanese financial institution Cathay United Bank is embarking on a significant regional expansion, planning to increase its hiring in Southeast Asia, India, and Japan to service major tech companies navigating supply chain shifts (Bloomberg). Meanwhile, renewed threats of U.S. tariffs over digital rules are causing concern in Europe, prompting discussions on how the continent can assert its own trade and tech agenda (Politico.Eu). These moves reflect a broader trend of businesses and governments adapting to a fluid and often contentious global trade environment.

Market Movers and Investment Flows

Shares of Contemporary Amperex Technology Co. Ltd. (CATL), a key Chinese battery manufacturer, surged to a three-year high following a supplier’s optimistic sales forecast, indicating strong investor confidence in the electric vehicle sector’s growth trajectory (Bloomberg). The market’s positive reaction highlights the pivotal role of supply chain sentiment in valuing companies at the forefront of technological innovation. This bullish outlook on battery sales suggests that capital continues to flow into sectors deemed critical for the future green economy, despite wider economic uncertainties.

Stay tuned for the next Gist—your edge in a shifting world.

Indonesian students vow more protests after one killed in Jakarta demonstration
— Strait Times

Japan’s manufacturing output falls as US tariffs bite, inflation slows
— Strait Times

CATL Shares Soar on Outlook for Battery Sales, Expansion
— Bloomberg

Head of powerful U.S. Senate armed services panel arrives in Taiwan to discuss defence
— Strait Times

Putin Meets With Modi and Xi to Thrash Out Energy Needs
— Bloomberg

Cathay United Bank Hiring for Regional Expansion
— Bloomberg

Transatlantic Trade Jolted

New US tariffs on small-parcel imports are now in effect, a move that dismantles a long-standing facilitator of digital trade. Washington has officially eliminated the $800 de minimis threshold—the value below which goods could enter the US tax-free. European e-commerce and specialty exporters, who relied on this rule for frictionless access to US consumers, now face significant new costs and administrative hurdles. My read is this isn’t merely a customs adjustment; it’s a deliberate constriction of market access that will likely see costs passed on to consumers or force smaller EU firms to abandon the US market. The only exemption is for gifts valued under $100. This policy directly challenges the principles of open, predictable trade that underpin global commerce. (Ansa)

The Retaliation Begins

Predictably, US protectionism is breeding retaliation. Brazil’s President Lula has formally initiated a process of economic countermeasures against Washington’s recent tariffs on its goods. (Ansa) Triggering a new “Law of Economic Reciprocity,” Brasília is preparing proportional tariffs on US goods and services. This is a textbook example of how trade barriers beget more trade barriers, escalating disputes and fracturing the global marketplace. Instead of fostering cooperation, the US policy is incentivizing a tit-for-tat response, with Brazil now creating its own defensive mechanisms. It’s a worrying signal that major economies are increasingly willing to abandon established trade norms for unilateral action. (Ansa)

Catch the next Gist for the continent’s moving pieces.

USA genehmigen Waffenverkauf an Ukraine
— Zdf

Amilon cresce all’estero con i servizi di marketing
— Il Sole 24 Ore

La empresa de Rafa Nadal de complementos alimenticios pierde 1,9 millones en su primer año
— El Pais

Der Ukraine-Krieg im Zeitraffer
— Zdf

Woltemade vor Wechsel zu Newcastle United
— Zdf

In Usa entrano ufficialmente in vigore i dazi sui pacchi
— Ansa