In March, U.S. President Donald Trump announced a sweeping series of tariffs. He announced this big news while speaking at an event in the White House’s Rose Garden in Washington, D.C. This announcement is the biggest tariff plan of his administration so far. The new tariffs, called duties, will impose devastating financial costs on our most important trading partners. Not surprisingly, this includes countries such as China, Taiwan, Vietnam, and Thailand.
These tariffs will establish a starting point of 10% for all nations to start from. This action sets a dangerous new precedent for conduct of international trade relations. The most significant part of this announcement is the structure of the tariffs, which is a two-tiered structure. Nearly 60 countries would have to deal with higher reciprocal tariffs themselves. These tariffs will be over 30% since the U.S. has large trade deficits with these countries. This more targeted approach allows the Trump administration to focus its activities on what they consider to be unfair trade practices. These practices have hurt the competitive edge of the U.S. economy.
President Trump touted his administration’s focus on protecting American jobs and industries with the implementation of these tariffs. He stressed that the levies are needed in order to establish a level playing field and a fair, equitable trading atmosphere. Protectionism Underneath everything, trade tensions are continuing to ratchet up between the U.S. and most Asian economies. This decision is highly problematic, as it invites retaliation against such retaliation and for broader implications in the realm of global trade.
These new tariffs are uniquely harmful to some economies more than others, including China. This country has increasingly emerged as a battleground in the broader trade war between the two countries. The effect on Taiwan, Vietnam and Thailand drives home the administration’s desire to take on trade imbalances throughout the region. President Trump uses these tariffs as leverage to strong arm countries. He does indeed want them to change their trade policies and practices.