Donald Trump ramped up his trade rhetoric this week, firing off more than 20 letters to governments outlining new tariff rates if agreements aren’t reached by 1 August.
In April, Trump announced a 10% base tariff rate and additional duties ranging up to 50% for many other countries, although he later delayed the effective date for all but 10% duties until 9 July after market panic.
Trump officials initially suggested they would strike dozens of deals with key economies by the 9 July deadline, but as the 90-day pause ended this week, the president announced a range of new rates for various countries, but delayed their implementation until next month.
Here’s what’s happened:
-
Trump informed powerhouse suppliers Japan, South Korea and a number of other nations at the start of this week that they will face tariffs of at least 25% starting from August unless they can quickly negotiate deals.
-
On Wednesday he announced more tariffs on countries like the Philippines, Sri Lanka and Algeria, as well as a 50% tariff on products from Brazil, tying the move to what he called the “witch-hunt” trial against its former president, Jair Bolsonaro. Trump criticised the trial Bolsonaro is facing over trying to overturn his 2022 election loss. Brazil’s president, Luiz Inácio Lula da Silva, threatened to hit back with reciprocal 50% tariff on US goods.
-
On Thursday, Trump announced the US would impose a 35% tariff on imports from Canada, despite ongoing negotiations and prime minister Mark Carney’s decision last month to rescind a digital services tax that faced criticism from the US president. Carney said his government would continue to defend Canadian workers and businesses in their negotiations and work towards the 1 August deadline.
-
Trump also said on Thursday that a letter would be sent to the European Union, the US’s biggest trading partner, “today or tomorrow”. Last week the EU and US were closing in on a high-level “framework” trade deal that would avert 50% tariffs on all exports from the bloc.
-
The steep tariff rates announced throughout the week range from 25-50%, with some of the harshest levies imposed on developing nations in south-east Asia, including 32% for Indonesia, 36% for Cambodia and Thailand and 40% on Laos and Myanmar, a country riven by years of civil war.
-
On his first official visit to Asia, US secretary of state Marco Rubio sought to reassure regional powers of Washington’s commitment to them, saying countries there may get “better” trade deals than the rest of the world. Prior to Rubio’s arrival in Kuala Lumpur, Malaysian prime minister Anwar Ibrahim condemned the tariffs at the opening of an Asean foreign ministers’ meeting.
-
Trump has also vowed to implement tariffs of up to 200% on foreign drugs and 50% on copper. Copper prices hit a record high in the US after the announcement.
-
US treasury secretary Scott Bessent said he expected several trade announcements this week, but to date the US has secured just two deals with trading partners. The first with the UK, signed on 8 May, includes a 10% tariff on most UK goods, including cars, and zero tariffs for steel and aluminium. A second deal was reached with Vietnam last week that sets a 20% tariff for much of its exports, although the full details are unclear, with no text released.
-
On Thursday, Trump said the tariffs had been “very well-received”, adding that the stock market “hit a new high today”.
-
Global stock markets have largely shrugged off the latest threats. Analysts say traders now expect a deal or another delay, while investors appear to be waiting until a deal is done or the tariffs kick in.
