The reciprocal tariff dilemma
Under the ‘Fair and Reciprocal Plan,’ the Donald Trump administration is countering “non-reciprocal trading arrangements with trading partners by determining the equivalent of a reciprocal tariff with respect to each foreign trading partner”. The average import-weighted tariffs on U.S. exports in 27 partner countries are lower than the corresponding U.S. tariffs. Considering only tariffs, this simple analysis thus rules out almost a fifth of all countries for which comparable tariff data are available from the ‘Fair and Reciprocal Plan.’ These countries include Canada, the EU, Japan, and the U.K. — among America’s largest trading partners, which together accounted for half of total U.S. merchandise exports in 2022. In fact, U.S. commercial interests could be harmed if these countries imposed reciprocal tariffs on American merchandise exports instead. Put simply, pursuing the policy of reciprocal tariffs against partners where there is a significant tariff differential results in raising average import duties on exports from countries for whom the U.S. is an important destination market.
EU welcomes Trump's 'pause' on reciprocal tariffs but to focus countries with 87% global trade
Discover Related
The staggering amount Trump's tariff war with China could cost every American family
Despite Trump's tariff pause, recession risk remains: JP Morgan
Donald Trump’s tariffs war: Does the 125% duty on China make it India’s time to shine?
As US buyers cancel orders, Chinese factories say no more discounts
Trump’s tariff pause brings investors relief—but worries remain
Trump transforms tariff war into high-stakes showdown with China
Trump pauses ‘reciprocal’ tariffs, but hits China harder
Tariff U-turn on 90 countries? Trump says people were getting 'yippy'
EU slaps $23 billion in tariffs on US goods over Trump's metal duties
US's 'bad actors' jibe at China, says India in front on trade negotiations
US bullying erodes values that made US world leader
Trump announces 90-day pause on new tariffs for most countries, raises China levies to 125%
In response to Trump's steel and aluminum duties, EU hits back with tariffs on $23 billion in US goods
The EU’s response to Donald Trump’s tariffs could be stinging
EU hits back at Trump tariffs, targets £20 billion US products: ’Countermeasures can be suspended if...’
China Raises Tariffs to 84% in Response to Trump’s 104% Import Levies
The MPC’s decision was the first scene of a whole new tariff-driven drama
Tariff war escalates as China imposes additional levy of 50%, says will charge 84% on US imports
S&P 500 nearing a bear market: Trump’s reciprocal tariffs spur market carnage as they take effect