WORLD
Trump’s reciprocal tax roils the world, China, India slapped with 54% & 27% taxes respectively
- IBJ Bureau
- Apr 04, 2025
President Donald Trump’s sweeping tariffs on US imports sparked threats of retaliation on Thursday, as companies and governments rushed to count the costs from an escalating trade war that threatens to shake up global alliances.
The penalties announced on Wednesday unleashed turbulence across world markets and drew condemnation from other leaders facing the end of an era of trade liberalisation that has shaped the global order for decades.
Mr Trump said that he would impose a 10 per cent baseline tariff on all imports to the United States and higher targeted duties on some of the country’s biggest trading partners, hammering goods from Italian coffee and Japanese whisky to sportswear made in Asia. Automaker Stellantis said that it would temporarily lay off US workers and close plants in Canada and Mexico.
China vowed retaliation for Mr Trump's 54 per cent tariffs on imports from the world’s No. 2 economy, as did the European Union, which faces a 20 per cent duty. Mr Trump announced “discounted reciprocal tariffs” on India, imposing 27 per cent, while claiming he was being “kind” by charging only half of what the country imposed on the US.
South Korea, Mexico, India and several other trading partners said that they would hold off for now as they seek concessions before the targeted tariffs take effect on April 9.
Washington’s allies and rivals alike warned of a devastating blow to global trade.
“The consequences will be dire for millions of people around the globe,” EU chief Ursula von der Leyen said.
Global stocks tumbled and investors sought safe-haven bonds and gold, as analysts said that the tariffs came in higher than expected. US stock markets plunged, with tech and retail stocks especially hard hit.
According to Fitch Ratings, the new US tariffs are the highest in more than a century. Imports to the world’s largest consumer market now face an average duty of 22.5 per cent, up from 2.5 per cent last year.
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