President Donald Trump announced a slew of new tariffs, including a 10% global minimum and 15% or higher duties for countries with trade surpluses with the US, forging ahead with his turbulent effort to reshape international commerce.
The baseline rates for many trading partners remain unchanged from the duties Trump imposed in April, which may soothe investors’ worst fears after the president had previously said they could even double. Yet his move to raise tariffs on Canadian goods to 35% threatens to inject fresh tensions into an already strained relationship.
Most of the tariffs will take effect after midnight on Aug 7, to allow time for US Customs and Border Protection to make necessary changes to collect the levies. Trump signed the directive just hours before his prior Aug 1 deadline for higher tariffs to kick in on scores of trading partners.
Taken together, the result will be significantly higher tariffs on goods from almost all US trading partners. The average US tariff rate will rise to 15.2% if rates are implemented as announced, according to Bloomberg Economics, an increase from 13.3% — and significantly higher than the 2.3% it was in 2024, before Trump took office.
Trump followed through on his threat to hike tariffs on exports from Canada, one of the US’s largest trading partners, to 35% from 25% starting Friday.
Major industrialised economies, including the European Union, Japan and South Korea, accepted 15% duties on their products, while charges on items from Mexico, Canada and China are even bigger.
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Trump is expected to unveil separate tariffs on imports of pharmaceuticals, semiconductors, critical minerals and other key industrial products in the coming weeks.
Asian stocks came under pressure after Trump announced the new rates, with the MSCI Asia Pacific Index dropping 0.5%, led by losses in South Korea and Taiwan. Futures on the S&P 500 slipped 0.1% while those for European stocks retreated 0.4%. The Taiwan dollar and Korean won led declines in currency markets, while the Swiss franc edged lower after the nation’s products were hit with a 39% charge, one of the few nations that saw its rate go up. The Canadian dollar held steady in the face of higher rates.
“The reality is that we’re still going to see higher tariffs than pre-Liberation Day and we’ll start to see some economic impact of that in the months ahead,” said Shane Oliver, a Sydney-based chief investment officer at AMP. “There’s still uncertainty about China, Mexico has been delayed by another 90 days and details around sectoral tariffs are also yet to come.”
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The announcement brings to a close, at least for now, months of wait-and-see about how Trump would set his country-based tariffs, which he billed as the centrepiece of his plan to shrink trade deficits and revive American manufacturing.
Trump twice delayed his so-called reciprocal tariffs, first announced in April, to allow time for negotiations, first after markets panicked and then as foreign governments bargained to get better terms from the US.
Thursday’s order was signed behind closed doors without the fanfare of Trump’s April tariff rollout, during which he brandished placards with rates during a Rose Garden event. Since then Trump has faced criticism for overpromising on trade deals after he and aides vowed to broker numerous agreements, with at least one pledging “90 deals in 90 days.”
In the end, imports from about 40 countries will face the new 15% rate and roughly a dozen economies’ products will be hit with higher duties, either because they reached a deal or Trump sent them a letter unilaterally setting import taxes. The latter group has the highest goods-trade surpluses with the US.
Some of those were expected, such as a 25% levy on Indian exports that Trump announced this week on social media. Others included charges of 20% on Taiwanese products and 30% on South African goods. Thailand and Cambodia, two countries that were said to have struck a last-minute deal, received a 19% duty, matching rates imposed on regional neighbors including Indonesia and the Philippines. Vietnam’s goods will be tariffed at 20%.
There were signs that Trump’s order took some partners by surprise. Taiwan’s cabinet said in a statement its rate was temporary, and that the US levy is expected to be reduced after more talks, which had been delayed by scheduling conflicts.
Other details are still forthcoming, including so-called “rules of origin” to decide which products are transshipped, or routed through another country, and thus would face at least a 40% rate, a senior US official said. A decision will be made in the coming weeks, according to the official.
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“US customs officials will face challenges implementing the EO, particularly with the different tariff rates now applied across the world,” said Wendy Cutler, a former US trade negotiator. “The seven day breathing period before implementation will help, but importers should expect start up problems at a minimum.”
In a separate order, Trump followed through on his threat to hike tariffs on exports from Canada, one of the US’s largest trading partners, from 25%. That change excludes goods that are covered under the North American trade pact he negotiated in his first term.
That stood in contrast to the 90-day extension Mexico received to negotiate a better agreement.
The lower 10% and 15% rates are expected to apply to a wide range of mostly smaller- and medium-sized economies that Trump showed little interest in bargaining with one-on-one. He had signalled in recent days there were simply too many countries to cut individualised deals with all of them.
Some smaller states, however, were hit with the highest rates, including Syria at 41%, as well as Laos and Myanmar at 40% each.
The tiny African nation of Lesotho, however, which had been reeling from Trump’s threat in April to impose a 50% duty, instead received a 15% rate. That change puts the landlocked mountainous kingdom at an advantage against the far larger country that entirely surrounds it, South Africa.
The senior US official said there is no date yet when revised auto tariff rates would be implemented. Trump’s deals with the EU, Japan and South Korea would lower duties on their vehicle exports to 15% from the general rate of 25%.
One big exception from this week’s deadline is China, which faces an Aug 12 deadline for its tariff truce with the US to expire. The Trump administration has signa'led that is likely to be extended. No final decision has been made but the recent US-China talks in Stockholm were positive, the official said.
Trump took office pledging to implement tariffs on a scale not seen in decades. He has long argued that the duties would boost domestic manufacturing and prevent the US from getting “ripped off” by other countries.
While his tariffs are already bringing in billions in revenue for the US government, the long-term economic impacts remain unclear, with critics saying they will raise costs for US consumers and businesses and exacerbate inflation.
