Trump plays ‘reciprocal tariffs’ card with broad targeting, starting at 10 percent

BEIJING, April 3 (Xinhua) -- U.S. President Donald Trump signed two executive orders on so-called “reciprocal tariffs” at the White House on April 2, announcing that the U.S. will set up a 10 percent “minimum baseline tariff” on its trading partners and impose higher tariffs on certain trading partners.

Speaking to the media in the White House Rose Garden, Trump said the “reciprocal tariffs” were “not exactly reciprocal” and that the U.S. would charge other countries and regions “about half of what they charge us in tariffs.” “Countries and regions that are bad for us, we will calculate the total, including non-monetary barriers.” Trump claimed.

He announced that the U.S. would impose a minimum baseline tariff of 10 percent on imports from other countries and regions.

Trump displayed a large tableau labeled “Reciprocal Tariffs,” indicating which trading partners the U.S. plans to tax and by how much. Among them, the United Kingdom 10%, Brazil 10%, Australia 10%, the Philippines and Israel 17%, the European Union 20%, Japan 24%, South Korea 25%, India 26%, South Africa 30%, Switzerland 31%, Indonesia 32%, Sri Lanka 44%, Vietnam 46%, Cambodia 49% ...... 

Trump added that that starting on the 3rd, the U.S. will impose a 25% tariff on all foreign-made imported cars. The automotive tariffs will cover cars, light trucks, engines, transmissions, lithium-ion batteries, and smaller parts such as tires, shock absorbers and spark plug wires. One of the tariffs for auto parts will begin no later than May 3rd.

Surprisingly, Trump said the auto tariffs would also cover all imported computers, including laptops and desktops, at a rate of 4 percent.

 Trump claimed that the new tariffs are designed to boost U.S. manufacturing and “make America rich again” and that “jobs and factories will come back.”

The baseline 10% tariffs will begin on April 5, while higher tariffs on different trading partners will begin on April 9, the White House said.

Damaging 

As Trump unveiled his new tariff policy, the dollar fell 1% against the euro. 　

In the hours leading up to Trump's tariff announcement, US stock markets fluctuated violently. Nasdaq futures extended their losses to 2.4 percent and S&P 500 futures fell 1.6 percent. Reuters said this meant investors expected stocks to plunge when they opened on the 3rd.

Trump claimed that April 2, when the “reciprocal tariffs” were announced, would be “liberation day” for the United States. But economists and investors warned that the “reciprocal tariffs” policy will not only hit trading partners, but will also harm U.S. consumers and drag down the U.S. own economic growth.

Economists are concerned that Trump's tariff policies will inevitably push up U.S. inflation and hurt consumer confidence. Bruce Kasman, chief global economist at JPMorgan Chase, expressed high concern about the U.S. economy earlier in March, predicting that the probability of a U.S. recession this year would be about 40 percent, significantly higher than the 30 percent predicted at the beginning of the year.

Yale University Budget Laboratory projections show that “reciprocal tariffs” implementation, if other countries do not take retaliatory measures, U.S. personal consumption expenditure prices will rise by 1.7% in the short term, the real GDP growth rate in 2025 will fall by 0.6 percentage points; if other countries to take retaliatory measures, U.S. personal consumption expenditure price increase will expand to 2.1%, and real GDP growth will fall by 1 percentage point.

Will be countermeasures 

At present, the European Union and a number of U.S. trading partners have indicated that they will respond to the U.S. tariff policy with retaliatory tariffs and other countermeasures.

Australian Prime Minister Albanese said on the 3rd that “the Trump administration's tariff policy has no logical basis and goes against the foundation of the partnership between our two countries” “This is not the behavior of a friend”.

Manfred Weber, President of the European People's Party, the largest party group in the European Parliament, said on the evening of the 2nd: "For our American friends, today is not a ‘day of liberation’ but a ‘day of resentment’. Trump's tariff policy is not a defense of fair trade, but an attack on fair trade out of fear."

European Commission President Von der Leyen told the European Parliament's plenary session in Strasbourg, France, on Jan. 1 that the U.S. tariffs are wrong and that widespread tariffs will only make the international trade situation worse. The EU has a strong countermeasure plan and will fight back against the U.S. tariff policy if necessary.

Reuters 2 cited the Canadian Prime Minister's Office sources reported that Canadian Prime Minister Carney and Mexican President Zinbaum on the 1st call, discussed the Canadian side “to combat the United States unreasonable trade actions” plan. Carney's office said in a statement: “In the face of challenging times ahead, Prime Minister Carney and President Simbaum emphasized the importance of maintaining the competitiveness of North America while respecting the sovereignty of each country.”

Speaking at the opening of the Hannover Messe 2025 on March 30, German Chancellor Sebastian Scholz said free trade is the cornerstone of global prosperity, but protectionist policies pursued by U.S. President Donald Trump are making it a serious challenge. He warned that the continuous imposition of tariffs by the U.S. side will exacerbate global uncertainty and deepen the fragmentation of the world economy, which in no way bodes well for the vast majority of businesses. He emphasized that there were no real winners in a trade war, which would only harm the interests of all involved, including the United States itself.