Trump announces steep tariffs against trading partners

Washington — President Donald Trump said on Wednesday that he would impose a 10% baseline tariff on all imports to the US and higher duties on dozens of the country’s biggest trading partners, deepening a trade war that he kicked off on his return to the White House.

The sweeping duties would erect new barriers around the world’s largest consumer economy, reversing decades of trade liberalisation that have shaped the global order.

Most trading partners are expected to respond with countermeasures of their own that could lead to dramatically higher prices for everything from bicycles to wine.

“It’s our declaration of independence,” Trump said at an event in the White House Rose Garden.

Trump displayed a poster that listed reciprocal tariffs, including 34% on China and 20% on the EU, as a response to duties put on US goods.

US stock futures sank after his announcement.

A White House official, speaking on condition of anonymity, said those penalties will take effect on April 9 and will apply to about 60 countries in all.

Canada and Mexico, the two largest US trading partners, already face 25% tariffs on many goods.

Australian Prime Minister Anthony Albanese said on Thursday the decision by Trump was not “the act of a friend”, but said his country would not place reciprocal tariffs against the US. Mexico said earlier it would not retaliate.

The baseline 10% tariff will take effect on Saturday, the official said.

After his remarks, Trump signed an order to remove a de minimis tariff exemption on low-cost products. Trump is also planning other tariffs targeting semiconductors, pharmaceuticals, and potentially critical minerals, the official said.

Trump’s barrage of penalties has rattled financial markets and businesses that have relied on trading arrangements that have been in place since the middle of last century.

The administration has said the new tariffs will take effect immediately after Trump announces them, though it has not yet published the official notice required for enforcement.

The administration, however, did publish an official notice that a separate set of tariffs on vehicle imports that Trump announced last week will take effect starting on April 3.

Trump has already imposed 20% duties on all imports from China and 25% duties on steel and aluminium and extended them to nearly $150bn worth of downstream products.

His advisers say the tariffs will return strategically vital manufacturing capabilities to the US.

Outside economists have warned that tariffs could slow the global economy, raise the risk of recession, and increase living costs for the average US family by thousands of dollars. Businesses have complained that Trump's barrage of threats has made it difficult to plan their operations.

Tariff concerns have already slowed manufacturing activity across the globe, while also spurring sales of autos and other imported products as consumers rush to make purchases before prices rise.

Financial markets were volatile as investors awaited Trump’s announcement. US stocks have erased nearly $5-trillion of value since February.

Reuters