On 2 April, President Donald Trump unveiled his plans to impose responsive import tariffs to strengthen the international economic position of the United States and protect American workers as the foreign trade and economic practices have created a national emergency, according to the President.

The decision is also driven by the absence of reciprocity in international trade relationships and harmful policies like currency manipulation and exorbitant value-added taxes (VAT) perpetuated by other countries. The United States has large and persistent annual trade deficits of goods that led to hollowing out of US manufacturing base. It resulted in a lack of incentive to increase advanced domestic manufacturing capacity. This also undermined critical supply chains and rendered US defense-industrial base dependent on foreign adversaries.

President Trump will impose a 10% import tariff on all countries using his authority under the International Emergency Economic Powers Act of 1977 (IEEPA). The legislation will come into effect on 5 April 2025. Some of the countries are listed below:

• United Kingdom;

• Singapore;

• Brazil;

• Australia;

• New Zealand;

• Turkiye;

• Colombia;

• Argentina;

• El Salvador;

• United Arab Emirates;

• Saudi Arabia;

• Chile;

• Australia;

• Peru.

However, Trump will impose an individualized reciprocal higher tariffs on the countries with which the United States has the largest trade deficits. This will take effect on 9 April 2025. The higher tariffs are in addition to already existing ones. The key trading partners subject to these customized tariff rates include:

• EU — 20%;

• Japan — 24%;

• South Korea — 26%;

• India — 27%;

• Pakistan — 30%;

• Taiwan — 32%;

• Thailand — 37%;

• Bangladesh — 37%;

• China — 34%;

• Vietnam — 46%;

• Cambodia — 49%.

United States-Mexico-Canada Agreement (USMCA) compliant goods will continue to see a 0% tariff, non-USMCA compliant goods will see a 25% tariff, and non-USMCA compliant energy and potash will see a 10% tariff. In the event the existing IEEPA orders are terminated, USMCA compliant goods would continue to receive preferential treatment, while non-USMCA compliant goods would be subject to a 12% reciprocal tariff.

A 25% tariff on all foreign made-automobiles was imposed on 2 April as well.

News about the introduction of new tariffs by the US has had a direct impact on the global markets. They began to drop. Players are uncertain about full potential effects. Many participants note that in the near future, this will lead to significant fluctuations in prices on the financial markets of various countries. Accordingly, a new wave of volatility for the dollar against other currencies will begin.

Tariffs will remain in place until President Trump determines that trade deficit threat is satisfied, resolved or mitigated. White House aides said this week that sweeping tariffs are not a bargaining tactic. However, President Trump announced on 3 April that he is open to negotiations.

Canadian authorities announced new countermeasures to protect Canadian workers, businesses and defend the country’s economy. Canada imposed 25% tariff on non-CUSMA compliant fully assembled vehicles imported from the United States along with 25% ones on non-Canadian and non-Mexican content of CUSMA compliant fully assembled vehicles from the United States.

On 4 April, China imposed reciprocal 34% tariffs on all imports from the United States. The legislation will come into force on 10 April.

The European Union's planned announcement regarding reciprocal tariffs on US imports has been deferred until mid-April. However, players believe it might be released earlier.