President Donald Trump is We are preparing to introduce mutual tariffs this week. – A major change in trade policy that could have widespread consequences on domestic inflation, as well as global commercial transactions.
The idea is simple. If another country places tariffs on American products, the US will respond by applying the same tariffs on that country's products.
The strategy aims to create a fairer trade environment, but it could escalate tensions and trigger a new tariff war, experts warn.
The European Union currently places 10% tariffs on vehicles imported from the US, while the US only charges 2.5% tariffs on European vehicles. According to Stephen Innes of Spi Asset Management.
The goal of Trump's mutual tariff plan is to eliminate these imbalances.
“I will announce it next week on mutual trade, and it will be treated equally with other countries. Trump told reporters in the Oval Office on Friday.
The president added that he plans to hold a press conference on the issue and a meeting on the issue on Monday or Tuesday.
Trump's mutual tariffs
Trump on Friday showed that mutual tariffs could replace universal import tariffs of 10% to 20%, an important part of his economic agenda during the campaign.
He said he is leaning towards implementing mutual tariffs “mainly” rather than broad import tariffs that apply across the board.
Trump announced on Sunday that he was set to implement a reversed 25% tariff on all steel and aluminum imports, and domestic industry played a key role in the success of his election on the battlefield. To protect the company, expand trade restrictions to key trading partners.
Speaking to reporters on Sunday in Air Force 1, he confirmed that tariffs will apply to imports from all countries, including major suppliers such as Mexico and Canada.
However, he did not specify when the new obligation would take effect.
Following the announcement, stocks in steel and aluminum producers rose early in trading.
Trump also said this week that he would introduce mutual tariffs on countries that impose taxes on imports. He said these measures will take effect “almost immediately” after the announcement.
When they reached the post, a Trump spokesman mentioned the president's remarks over the weekend.
Trump has so far stopped imposing tariffs on imports from Canada and Mexico after these two countries agreed Implement border security measures Stop the flow of immigration and fentanyl.
China's tariffs on US goods
China is scheduled to implement retaliatory tariffs on various US goods starting Monday, allowing trade tensions between the two economic giants to further strengthen.
The new tariffs ranging from 10% to 15% cover US exports such as crude oil, liquefied natural gas, agricultural machinery and several other major products.
These measures were announced last week in direct response to the US, which imposes a comprehensive 10% tariff on Chinese imports.
The Trump administration's move was intended to increase pressure on Beijing to take more powerful action against fentanyl's flow to the US.
China plays a key role in the supply chain of chemicals used by Mexican cartels to produce synthetic opioids, which are contributing to the ongoing drug crisis in the United States.
“If they collect mutual tariffs, we will respond kindly,” Dr. Son acquired Son, a professor of finance and economics at Loyola Marymount University. “Mutual tariffs are actually TITs of TAT.”
Trump's candidate for Commerce Secretary, Howard Lutnick, repeated this position, insisting, “How you treat us, how you should expect to be treated.”
Some reports suggest that the EU is already considering lowering automobile rates in line with US policies, but other countries like India and Brazil also pressure to modify their trade practices. suggests that you may face the challenge.
Adjusting tariffs across countries requires enormous management efforts and creates potential inefficiencies and disruptions among importers and customs officials.
Industries affected
General trade data may suggest that the US faces an average foreign fee of around 2.5% to 3%, but this is what it does for major industries such as steel, agriculture, semiconductors and pharmaceuticals. It does not reflect the higher tariffs imposed.
In many cases, these target tariffs act as economic protectionism, protecting domestic industries in order to prevent a wide statistical average from being acquired.
Many developed economies, especially in Europe, maintain tariff rates for US goods relatively close to what the US was imposed on exports, but policies can still cause tension, especially in industries such as agriculture and automobiles. It has sex.
Countries affected
However, the biggest impact is expected to be felt in emerging and developing economies, particularly in South America, Africa and South Asia.
These regions face the most significant risks from the proposed tariffs, According to Bloomberg Economics.
An analysis by senior economist Maeva Cousin compared the average nationally charged fees for imports from the US to those charged by the US on goods.
The findings suggest that mutual tariffs are “particularly painful for many emerging and developing economies.”
Cousin further stated that virtually every country will experience some degree of economic tension if the US only triggers duties when foreign tariffs are high, and if it does not change lower tariffs.
Apart from raising tariffs, the policy represents a broader strategy aimed at trade negotiations.
Trump's approach isn't merely about increasing foreign goods obligations. Rather, it is to use tariffs as leverage to promote better trade transactions.
If successful, this could lead to a restructuring of international trade relations, bringing some industries back to the US and changing global economic dynamics.
The main driver of this policy is the US trade deficit, which reached $918.4 billion in 2024.
The biggest contributors to this imbalance include the US$29.54 billion deficit, the EU, the US$235.6 billion EU, the US$171.8 billion Mexico and the US$123.5 billion Vietnam.
