Trump's attack on world trade
Yesterday, Donald Trump ordered extensive tariff increases, the most aggressive in American economic history.
Commerzbank Economic Research
04/03/2025
What did Trump announce?
President Trump announced a comprehensive adjustment of US foreign economic policy yesterday and ordered a comprehensive increase in tariffs. Specifically:
An additional 10% tariff will be levied on all US imports starting on April 5.
For countries that the US considers to engage in particularly unfair trade practices, this rate will be increased to a country-specific “adjusted” (i.e. higher) tariff rate from April 9. This affects a total 57 countries, including many of the US's largest trading partners. This tariff will be levied in addition to existing tariffs. China, for example, has already been hit with a general 20% tariff by Trump. If you include the country-specific tariff rate of 34%, the tariff on imports from China increases to 54%. An adjusted reciprocal tariff rate of 20% has been set for the EU. The UK is not on the blacklist; after all, the US has a trade surplus with the UK. This means that the 10% tariff will remain in place for Britain, which applies to all those not on the list of particularly unfair trading partners.
Different rules apply to Canada and Mexico, which are linked to the US in a free trade area. All imports that meet the value-added rules of the USMCA will be exempt from additional tariffs, while other imports from these countries will be subject to a 12% tariff.
Product-specific special tariffs, such as the 25% tariff on car imports or the tariffs on steel and aluminum imports, remain in place.
In addition, only the non-US portion of the value added to imports will be subject to the additional tariffs, provided that the US portion is at least 20%.
A whole range of products will be exempt from the additional tariffs if the US itself does not have the required amount or if the products are important to the US. These product categories are listed in an annex to the executive order. They include pharmaceutical products, fossil fuels, chemical products, semiconductors, minerals and wood. This roughly affects one-fifth of US imports. Pharmaceutical products (16% of German exports to the US) and chemicals (9% of exports) are important for Germany. However, in many cases this is likely to be only a temporary exception. Some of the US authorities' findings are not yet available, so further tariff increases are quite possible here in the medium term.
For full text see attached PDF-Version.
