President Donald Trump is imposing tariffs on US trading partners worldwide, his biggest assault yet on a global economic system he has long bemoaned as unfair.
Trump said Wednesday he will apply a minimum 10% tariff on all exporters to the US and slap additional duties on around 60 nations with the largest trade imbalances with the US.
That includes substantially higher rates on some of the country’s biggest trading partners, such as China — which now faces a 54% total tariff — the European Union and Vietnam.
“For years, hard-working American citizens were forced to sit on the sidelines as other nations got rich and powerful, much of it at our expense. But now it’s our turn to prosper,” Trump said during an event in the White House Rose Garden.
The higher “reciprocal” rates targeting nations the Trump administration labels the worst offenders are based on a government tally of the levies and non-tariff barriers those countries impose on US goods. Under Trump’s plan, those countries facing higher, customized rates will be hit with a levy equal to one-half of that calculated amount.
The baseline import taxes will take effect after midnight Saturday and the higher duties will kick in at 12:01 a.m. on April 9, according to senior administration officials who discussed details the condition of anonymity ahead of Trump’s announcement. Canada and Mexico already face 25% tariffs tied to drug trafficking and illegal migration; those will remain in place and the US’s two largest trading partners will not be subject to the new tariff regime as long as the separate tariffs are in effect. Exemptions on goods covered by the USMCA North American trade agreement Trump brokered in his first term will stay.
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The president’s announcement set off declines of 2% or more in equity benchmarks that had rallies for days on hopes his plan would be more lenient. Automaker shares traded lower virtually across the board. Ford Motor Co, General Motors Co, Stellantis NV and Tesla Inc all declined after regular trading in New York. Oil prices, initially down after the announcement, reversed course in post-settlement trading. The US relies on European shipments of fuel to meet demand in the East Coast, where there are few refineries remaining. The US also exports crude to countries.
Mary Lovely, a senior fellow at the Peterson Institute for International Economics, said the tariffs Trump announced Wednesday were “much worse than we feared.” Just how they would be administered was unclear, she said, and there were “huge implications for rerouting of trade” globally.
China’s cumulative tariff rate includes both an existing 20% duty tied to fentanyl trafficking and a 34% levy calculated as part of Trump’s reciprocal plan, according to people familiar with the matter. The European Union will have a 20% levy and Vietnam is seeing a 46% tariff, White House documents showed. Other nations slapped with larger tariffs include Japan at 24%, South Korea at 25%, India at 26%, Cambodia at 49% and Taiwan at 32%. In an act of showmanship, Trump brandished large boards during his 48-minute address that displayed each nation’s tariff.
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“Asian countries in particular look like they are in the line of fire,” said Wendy Cutler of the Asia Society Policy Institute.
The move marks a dramatic escalation of Trump’s trade war, threatening to draw immediate retaliation from US trading partners. It makes good on months of promises from Trump, who has embraced tariffs as a tool for asserting US power, rebalancing trade relationships, rebuilding American manufacturing and exacting geopolitical concessions. It’s also a stark break from a decades-long effort following World War II to lower trade barriers as a way to prevent armed conflicts.
Yet Trump’s plan is also narrower than some of the other options his team considered, including a 20% full global tariff. The president and his aides deliberated back-and-forth about which plan to enact until just hours before he announced the tariffs.
Steel, aluminium, and automobiles already subject to Trump’s duties will not face reciprocal tariffs, according to a White House document. Copper, pharmaceuticals, semiconductors, and lumber products expected to soon be hit with a tariff investigation under Section 232 of the Trade Expansion Act will also be exempt, as are bullion and energy not available in the US.
In the event the existing Canada and Mexico tariffs are terminated, USMCA-compliant goods would continue to receive preferable treatment while items not covered by the agreement would be subject to a 12% tariff, a White House statement said.
“This is not full reciprocal. This is kind reciprocal,” Trump said.
The Mexican peso and Canada’s dollar immediately jumped to session highs against the US dollar after the news that both countries aren’t subject to reciprocal tariffs for now. The peso was up 0.8%, while the loonie gained 0.5%.
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Trump indicated he would consider lowering rates if other nations remove their trade barriers on US exports, urging foreign leaders to “terminate your own tariffs, drop your barriers” and “don’t manipulate your currencies.”
Treasury Secretary Scott Bessent pressed US trading partners not to take retaliatory steps against Trump’s reciprocal tariffs.
“I wouldn’t try to retaliate,” Bessent said in an interview Wednesday with Bloomberg Television. “As long as you don’t retaliate, this is the high end of the number.”
Trump declared a national emergency tied to the US trade deficit, which stood at more than US$918 billion for goods and services in 2024, allowing him to use unilateral authority under the International Emergency Economic Powers Act to impose the most sweeping set of tariffs in generations. The administration is aiming revive American manufacturing with its protectionist shift and collect hundreds of billions of dollars in revenue from the new levies to fill government coffers.
The president’s move is a historic gamble that is expected to raise the cost of trillions of dollars in goods shipped annually to the US from other countries. It also could ignite a worldwide trade war, marked by tit-for-tat strikes that destabilize supply chains, stoke inflation, embolden America’s economic rivals and encourage foreign powers to form new alliances that exclude the US.
That dynamic presents a political problem for Trump: economic hurt from the tariffs could come quickly, while any gain in the form of a restructured US economy could take years or longer to materialize.
“The preliminary numbers are definitely more than we were expecting” and could boost the prices of some imported goods, said Veronica Clark, an economist at Citigroup Inc. “But in general we haven’t been as worried about broader inflation spillover because demand is weaker.”
