On April 2, U.S. President Trump signed two executive orders at the White House, officially launching the so-called “reciprocal tariffs” policy. According to this policy, the United States will impose a minimum tariff of 10% on all trading partners, with higher rates applied to certain countries and regions.
During a press conference in the White House Rose Garden, Trump explained that “reciprocal tariffs” are not exactly equivalent. He stated that the U.S. would charge roughly half of what other nations charge us, and for countries and regions that are unfavorable to the United States, additional costs such as non-monetary barriers would also be taken into account. Specifically, imported goods from other countries will be subject to at least a 10% tariff.
Trump displayed a large sign detailing the tariff rates imposed on various trading partners. The sign indicated that products imported from countries such as the United Kingdom, Brazil, and Australia would be subject to a 10% tariff; while those from the Philippines and Israel would incur a 17% tariff, the European Union 20%, Japan 24%, South Korea 25%, India 26%, South Africa 30%, Switzerland 31%, Indonesia 32%, Sri Lanka 44%, Vietnam 46%, and Cambodia as high as 49%.
In addition, he announced that starting from the 3rd, the United States will impose a 25% tariff on all imported automobiles manufactured abroad, including not only complete vehicles but also key components such as engines, transmissions, lithium-ion batteries, and smaller parts like tires, shock absorbers, and spark plug wires. The tariffs on these auto parts are scheduled to take effect by May 3. Furthermore, Trump mentioned that imported computers—including laptops and desktops—will be subject to a 4% tariff.
Trump emphasized that these measures are intended to revive American manufacturing, claiming they would bring back jobs and factories to the United States. According to the White House, the base 10% tariff will be implemented on April 5, while the higher tariffs for certain trading partners will take effect on April 9.
The policy announcement triggered immediate market reactions. Following Trump’s declaration, the U.S. dollar fell by 1% against the euro, and in the hours preceding the announcement, U.S. stock markets experienced significant volatility, with Nasdaq futures dropping by 2.4% and S&P 500 futures declining by 1.6%, reflecting investors’ concerns over future market performance.
At the same time, several economists warned that Trump’s tariff policy could inevitably push up U.S. inflation and weaken consumer confidence. Bruce Kasman, Chief Global Economist at JPMorgan Chase, had earlier expressed concerns about the U.S. economy in March, raising the probability of a recession this year to 40%, up from an initial forecast of 30%. An analysis by the Yale University Budget Project indicated that if other countries do not retaliate, U.S. personal consumption prices might rise by 1.7% in the short term, with actual GDP growth falling by 0.6 percentage points; if retaliatory measures are taken, the inflation rate could increase to 2.1% and GDP growth might decline by 1 percentage point.
In response, the European Union and several major U.S. trading partners have indicated plans to take countermeasures. Australian Prime Minister Albanese criticized Trump’s policy as lacking logical basis and violating the foundation of their bilateral partnership; the leader of the European People’s Party, Manfred Weber, sarcastically remarked that for the U.S., today is more “Day of Resentment” than “Day of Liberation”; and European Commission President von der Leyen asserted that imposing widespread tariffs would only worsen international trade tensions. Leaders from Canada and Mexico have also discussed strategies to counter what they consider “unreasonable” U.S. trade actions. German Chancellor Scholz, speaking at the Hannover Messe in March, stressed that free trade is the cornerstone of global prosperity, warning that U.S. protectionist policies only increase global uncertainty and ultimately harm all parties, including the United States itself.
Overall, while Trump’s tariff measures are aimed at reviving American manufacturing, the potential ripple effects and international retaliatory actions may have far-reaching consequences on global trade patterns and the U.S. economy itself.
