Adapted by:
Miguel Jorge
WriterJournalist. I've spent more than half of my life writing about technology, science, and culture. Before landing here, I worked at Telefónica, Prisa, Globus Comunicación, Hipertextual, and Gizmodo. I'm part of Webedia's cross-section team.
Alba Mora
WriterAn established tech journalist, I entered the world of consumer tech by chance in 2018. In my writing and translating career, I've also covered a diverse range of topics, including entertainment, travel, science, and the economy.
President Donald Trump’s tariff policies are unpredictable, even targeting the most unexpected places. This includes the small island of Diego Garcia, which, surprisingly, serves as a secret base for the U.S. The Trump administration has also imposed tariffs on uninhabited archipelagos and islands that, at best, have only penguin communities.
An unusual announcement. At the Liberation Day event on Wednesday, Trump surprised the world by including territories with no economic activity or stable populations in his list of trade sanctions. The official White House list features enclaves that are irrelevant to international trade but are now subject to levies of up to 50%. Many have criticized the apparent lack of economic rationale in the selection of these territories.
Heard Island and McDonald Islands. These remote islands are Australia’s outer territories located in the Indian Ocean, 2,500 miles from Perth. Recognized as a UNESCO World Heritage Site, they’re primarily known for their glaciers, penguin colonies, and elephant seals.
The Australian islands have also been subjected to a 10% tariff. The CIA describes them as “desolate” and “80% ice-covered.” They’ve had no economic activity since 1877, when the extraction of elephant seal oil ceased and the former seal hunters abandoned them.
Cocos Islands and Jan Mayen Island. The Cocos Islands archipelago is another Australian enclave affected by Trump’s tariffs. It’s home to around 600 people. Their exports, mainly boats, depend on the U.S. market for 32%. They’ll now face a 10% tariff.
At the other end of the world, the Norwegian island of Jan Mayen is a former whaling station with no permanent residents and absolutely no economy. It’s also been hit with the same levy despite its commercial insignificance. Australian Prime Minister Anthony Albanese expressed surprise and concern. “Nowhere on Earth is safe,” he said, highlighting the absurdity of taxing territories with no real productive capacity.
The Diego Garcia Island
Tokelau and Saint Pierre and Miquelon archipelagos. Of all the newly announced taxes, the tariff on Tokelau stands out as particularly surrealistic. Tokelau is an autonomous territory of New Zealand comprised of three atolls. Home to about 1,600 residents, it has a modest economy valued at $8 million, with exports barely reaching $100,000. Under the new regulations, Tokelau will have to pay a 10% tariff for exports to the U.S.
Even more surprising is the case of Saint Pierre and Miquelon. The archipelago is a small French territory near Newfoundland with a population of around 5,000. Its seafood and shellfish exports now face a staggering 99% tariff, which is significantly higher than the 20% imposed on the rest of France under European Union rules.
Lesotho. This landlocked African nation relies on diamond, textile, and wool exports. It’ll now incur a 50% tariff on 20% of its shipments to the U.S., representing a severe blow to its fragile annual economy of $900 million.
Why? The key to understanding the significant impact on these micronations lies in how the Trump administration has determined the new tariffs. They’re not based on a “reciprocal” arrangement tied to the tariffs each nation imposes on the U.S. Instead, they depend on the trade balance each territory holds with the U.S.
For instance, imagine that Lesotho exclusively sells a rare endemic fruit to the U.S. However, being a poor country with limited purchasing power for technological and high-value goods, it purchases nothing in return. In this case, Lesotho would find itself in a surplus position, even though it’s not attempting to exploit this relationship.
The tariffs are calculated by dividing the country’s trade balance with the U.S. (exports minus imports) by total exports. As a result, Lesotho, which has significant exports but minimal imports, appears to be in debt.
Plot twist: U.S. allies. The U.S. may have harmed its own interests by imposing tariffs on territories that are crucial to its military operations. This includes Diego Garcia Island, which hosts secret military bases key to national security.
Notably, the British Indian Ocean Territory, where Diego Garcia is located, hosts joint military bases operated by both the United Kingdom and the U.S. Trump has imposed a 10% tariff there even though the territory’s only inhabitants are U.S. military personnel and contractors.
Similarly, the Marshall Islands in the Pacific Ocean include the U.S. base at Kwajalein Atoll for ballistic testing. They’re protected under a free association agreement with Washington. The islands will also face an additional 10% tariff on their exports, although the U.S. isn’t their primary trading partner.
A lack of clear economic criteria. Overall, the recently announced tariff package lacks clarity. It indiscriminately impacts territories that hold little weight in international trade or possess minimal economies. The new measures don’t target major powers. Instead, they extend to uninhabited islands, wildlife-rich islets, military bases, and overlooked enclaves. This approach raises questions about the logic and intent behind the Trump administration’s trade strategy.
The actual impact of these tariffs might be negligible for some territories. For others, such as Saint Pierre and Miquelon and Lesotho, the consequences could be disproportionately severe for their small or dependent economies.
Images | Angie Corbett-Kuiper | Wikimedia Commons
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