NICARAGUA · TRADE
Key Facts
- The country Nicaragua is a Central American country that sold the United States US$4.96 billion of goods in 2025.
- Why now A 12.5% US tariff has applied since 24 July, and a 10% step is set for 1 January.
- The numbers US imports from Nicaragua were US$3.52 billion in January to August 2026, up 6.9% on a year earlier.
- What it means for you Coffee, beef and gold are on the exemption list; cigars are not.
- Still open How the new tariff stacks with the December 2025 action is not stated.
In Plain English
Section 301 is a US trade law that lets the president and the US Trade Representative, the White House trade office, answer another country’s trade practices with tariffs. A tariff is a tax that the US importer pays at the border when goods enter, and the importer often passes part of it on in the price.
CAFTA-DR is the free trade agreement between the United States, the Dominican Republic and five Central American countries, including Nicaragua. A tariff code is the number customs officers use to classify a product.
Goods from Nicaragua have faced a 12.5% US tariff since Friday 24 July 2026, with long exemption lists that cover coffee, beef and gold. A separate duty set in December 2025 on Nicaraguan goods that are not made under the CAFTA-DR trade agreement rises from 0% to 10% on Friday 1 January 2027, which is 63 days after 30 October 2026.
This explainer sets out what each measure covers and what US trade data show through August. No notice explains how the two fit together.
What Happened in July
On Thursday 23 July 2026 President Donald Trump signed a memorandum telling the US Trade Representative to tariff goods from 60 economies that, in the trade office’s findings of 2 June, do not ban or effectively enforce a ban on imports made with forced labor. Nicaragua was set at 12.5%, as were Costa Rica, Chile, Colombia and Brazil, while Honduras, Guatemala and El Salvador were set at 10%.
The trade office’s notice of Tuesday 28 July wrote the duty into the tariff schedule as heading 9903.05.58 for goods entered or withdrawn from warehouse from 12:01 am Eastern time on Friday 24 July. Goods already in transit and entered before 28 July were exempt.
What Is Exempt
The notice lists exempt products by tariff code, and the list includes beef, coffee and gold, along with many medicines, fertilizers, metals and raw materials. It also exempts civil aircraft, goods already under separate national-security tariffs, donations and personal items in accompanied baggage.
Textile and apparel goods of Nicaragua are exempt only when they enter free of duty under CAFTA-DR, the agreement that also covers Costa Rica, the Dominican Republic, El Salvador, Guatemala and Honduras. Cigars do not appear in any of the exemption lists, so they fall under the 12.5% rate.
The December 2025 Measure
A separate notice of the trade office, published on Friday 12 December 2025, set a tariff on all Nicaraguan goods that do not originate under CAFTA-DR, after the trade office determined, in an investigation opened on 10 December 2024, that Nicaragua’s labor, human-rights and rule-of-law practices are unreasonable and burden US commerce. The rate was 0% on Thursday 1 January 2026 and rises to 10% on Friday 1 January 2027 and to 15% on Saturday 1 January 2028.
That notice lists no product exclusions, although commenters had asked that cigars, coffee, beef and textiles be spared. A second notice, published on Monday 29 December 2025, wrote the phased rates into the tariff schedule as heading 9903.89.01, and an earlier proposal of October 2025 had floated duties of up to 100%.
What the Trade Data Show
The US Census Bureau’s tables show US imports of goods from Nicaragua of US$4.96 billion in 2025 against US$2.43 billion of US exports to Nicaragua, a deficit of US$2.53 billion. From January to August 2026 imports reached US$3.52 billion, up 6.9% from US$3.30 billion a year earlier.
Imports were US$470.2 million in July and US$474.4 million in August, up 4.6% and 1.3% on the same months of 2025. The duty began only on 24 July and covers goods entered after that date, so these months say little yet about its effect.
Who Is Exposed
The central bank’s preliminary figures show Nicaragua exported US$5.33 billion of goods in 2025 outside its free zones, led by gold at US$1.97 billion, beef at US$960.8 million and coffee at US$918.4 million. Those three lines add up to US$3.85 billion, or 72% of the total, and all three appear on the US exemption list by tariff code.
Free-zone exports totaled US$3.58 billion, including textiles at US$2.00 billion and tobacco at US$431.7 million. These central bank figures cover all destinations, and the US share of each line is not shown.
What It Means for You
US roasters, beef packers and gold refiners that buy from Nicaragua are outside the July duty, because their tariff codes are on the exemption list. Importers of cigars and other goods not on the list pay the duty at the border, and that cost can reach shelf prices.
Tariff codes are specific, so an importer should check the code and origin papers of each product with a customs broker. Honduras and El Salvador face 10% against Nicaragua’s 12.5%, while Costa Rica sits in the same 12.5% group as Nicaragua.
What Is Not Known
The July notice does not mention the December action, and none of the notices says how the 12.5% duty and the 10% step on non-CAFTA-DR goods would combine from 1 January 2027. The 10% step is already written into the tariff schedule by the notice of 29 December 2025, and no later notice in the Federal Register amends it as of 30 October.
The July memorandum lets the trade office modify or end the tariffs and exemptions, and the December notice keeps further action open, so the rates could change before 1 January. The Census tables for September and later months will give a fuller reading, and the Nicaragua section collects the related coverage.
Frequently Asked Questions
What is the US tariff on Nicaraguan goods?
Since Friday 24 July 2026 most goods from Nicaragua face a 12.5% tariff, with exemptions for products such as coffee, beef and gold. A separate duty on goods not made under CAFTA-DR is 0% now and 10% from 1 January 2027.
Is Nicaraguan coffee hit by the 12.5% tariff?
No, coffee appears on the exemption list of the 28 July notice by tariff code. The December 2025 duty applies only to goods that do not originate under CAFTA-DR, and its rate is 0% until 1 January 2027.
When does the next Nicaragua tariff step start?
The December 2025 action sets a 10% rate on non-CAFTA-DR goods on Friday 1 January 2027. It rises to 15% on Saturday 1 January 2028.
Are Nicaraguan textiles covered by the 12.5% duty?
Textile and apparel goods that enter free of duty under CAFTA-DR are exempt from the July duty. Textiles that do not qualify for CAFTA-DR treatment do not get that exemption.
Sources: US Trade Representative, Notice of Actions in Section 301 Investigations, Federal Register, 28 July 2026; The White House, Memorandum of 23 July 2026, Federal Register, 28 July 2026; US Trade Representative, Notice of Action on Nicaragua, Federal Register, 12 December 2025; US Trade Representative, Notice of Implementation of Action on Nicaragua, Federal Register, 29 December 2025; US Census Bureau, trade in goods with Nicaragua, data to August 2026; Central Bank of Nicaragua, Nicaragua en cifras 2025.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief