The Trump administration fired its latest trade salvo this week, announcing proposed tariffs of up to 12.5% on imports from 60 economies following a sweeping investigation into forced labor practices. The announcement, released by U.S. Trade Representative Jamieson Greer on June 2, represents one of the most expansive uses of Section 301 of the Trade Act of 1974 in decades and lands squarely on the desks of trading partners across every inhabited continent, including Costa Rica and its Central American neighbors.
The investigation, which was formally launched in March 2026, examined whether each of the 60 targeted economies had failed to impose and effectively enforce a prohibition on the importation of goods produced with forced labor. The USTR concluded that 54 of the 60 economies had neither imposed such a prohibition nor effectively enforced one.
The remaining six, including Canada, Mexico, the European Union, Ecuador, Indonesia, and Pakistan, had laws on the books but were found to have failed to enforce them adequately. All 60 were ultimately found to burden U.S. commerce, and all 60 are subject to proposed tariff action.
The tariff structure breaks into two tiers. Economies that have a forced labor prohibition in place, even if enforcement has been found wanting, face a proposed additional tariff of 10%. Those with no prohibition at all face 12.5%. Costa Rica, along with Honduras, Nicaragua, and the Dominican Republic, was placed in the 12.5% tier, a finding that will be unwelcome in San José given our country’s longstanding reputation as one of the more progressive labor markets in the region. El Salvador and Guatemala, which have made commitments related to forced labor import prohibitions through agreements with the United States, were placed in the 10% tier.
There is, however, a carveout that directly affects parts of Costa Rica’s export sector. The proposed action includes a list of product exclusions in Annex A, including coffee and pineapples, while a separate CAFTA-DR carveout applies to textiles and apparel articles that enter duty-free as goods of Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua. Those proposed exclusions would offer relief to some exporters in the region if the proposal is finalized in its current form.
The proposed exclusions are not guaranteed to survive the comment and hearing process, but their inclusion in the initial proposal offers meaningful relief to affected exporters.
The proposed tariffs are not yet in effect. They must pass through a formal public comment period, with written submissions accepted through July 6 and a public hearing scheduled before the USTR on July 7. The administration has made clear it is open to negotiated solutions with countries that move quickly to adopt forced labor import prohibitions of their own.
The broader context for this action is important. The U.S. Supreme Court earlier this year struck down the administration’s use of emergency economic powers legislation as a basis for sweeping tariff action, forcing the White House to rebuild its trade architecture through other legal authorities. Section 301 has emerged as the primary vehicle for that rebuilding, with the forced labor investigations representing the second major wave of Section 301 actions in 2026 following earlier probes into manufacturing overcapacity.
For Costa Rica, the practical near-term exposure is limited for some key products by the proposed exclusions, but the reputational dimension of appearing on a forced labor findings list alongside China and Venezuela is a separate matter entirely.
