Donald Trump has upended decades of US foreign policy by bringing in expansive new tariffs under a plan he insists will ‘Make America Wealthy Again’.
The US president announced the reciprocal tariffs in a major escalation of his trade war that threatens to to stoke inflation and stall growth.
‘My fellow Americans, this is Liberation Day,’ he said during an event at the Rose Garden of the White House on Wednesday, which he had branded ‘Liberation Day’.
‘We have been waiting for a long time. April 2, 2025, will forever be known as the day American industry was reborn, the day America’s destiny was reclaimed and the day that we began to make America wealthy again.’
The president said that ‘for decades our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike’.
He said American steel and automobile workers, farmers and skilled craftsman have ‘suffered bravely’ and watched as ‘foreign leaders have stolen our jobs, foreign cheaters have ransacked our factories and foreign scavengers have torn apart our once beautiful America dream’.
The new tariffs policy went into effect at midnight. Here are five takeaways from his plan:
What are reciprocal tariffs?
Trump cast his policy as ‘kind reciprocal’ tariffs.
This means the US will charge ‘approximately half’ of what other countries are currently charging America, he said, adding that he could have imposed much higher levies on trading partners.
The president held up a large chart titled ‘Reciprocal Tariffs’ laying out how dozens of countries – and the European Union as a whole – will be affected.
It included a column for ‘tariffs charged to the USA’ and a column for ‘USA discounted reciprocal tariffs’ alongside it.
For example, according to his administration, China charges 67% tariffs on the US, which will charge it 34%.
Vietnam charges the US 90% tariffs and America will impose 46%. Japan charges the US 46% and America will reciprocate with 24%.
What tariffs is Trump imposing on the UK and EU?
The chart stated that the EU charges the US 39% tariffs and the US will impose 20% reciprocal tariffs.
When it comes to the UK, Trump said of the tariffs it charges America and what the reciprocal amount will be: ‘10% and we’ll go 10%, same thing.’
The 10%, though appearing comparably low to other countries, comes despite the US running a trade surplus with the UK, which is a close ally.
Is Trump imposing reciprocal tariffs on all countries?
Trump said that countries not listed in the chart will face a minimum baseline tariff of 10% ‘to prevent cheating… we’re going to have a minimum of cheating’.
He established a 10% baseline tariff across all trading partners, with rates higher than that for 60 nations that are the ‘worst offenders’.
Trump said the tariffs could be zeroed out only if foreign countries relocate their facilities to America.
China, which is the largest importer to the US after Mexico, was hit especially hard with a 54% tariff under Trump’s new policy.
Will Trump’s tariff policy ‘Make America Wealthy Again’?
After putting the chart down, Trump took out a red MAGA hat and offered it first to the audience and then specifically to automobile workers who were invited to the event.
‘I’m not giving it to the Cabinet, I’m giving it to the auto workers,’ he said. ‘Thank you, fellas. They deserve it more than our Cabinet. Our Cabinet has plenty of hats.’
Trump said the tariffs will usher in a ‘golden age’ for the US and that ‘jobs and factories will come roaring back into our country’.
‘We can be so much wealthier than any other country, it’s unbelievable,’ Trump said.
‘We’re going to take care of our people first, and I’m sorry to say that.’
There were little details known on Trump’s tariff plans before he revealed them, but experts issued warnings of their impacts abroad and domestically.
White House Press Secretary Karoline Leavitt earlier this week said that the tariffs will affect almost all of the US’s trading partners and will go into effect ‘immediately’.
She added that the tariffs will ‘improve American competitiveness in every area of industry, reduce our massive trade deficits, and ultimately protect our economic and national security’.
How has the market reacted to Trump’s tariffs?
The sweeping penalties immediately unleashed turbulence across world markets and drew condemnation from other leaders.
Commodities including oil, copper and agricultural products fell, while safe-heaven gold jumped to an all-time high.
‘The higher-than-expected reciprocal tariffs have predictably raised worries of a US recession and slower global growth,’ Vivek Dhar, a commodities strategist at Commonwealth Bank of Australia said in a note.
‘Copper and oil futures, which typically track the global growth narrative, have declined this morning.
‘Oil demand growth is particularly leveraged to emerging economies, especially in Asia, where some of the reciprocal tariffs are high.’
As Asia digested the news today, stock markets in Beijing and Tokyo also sank to multi-month lows, with US and European stock futures also pointing to sharp losses.
Now facing 54% tariffs on exports to the US, the world’s No. 2 economy China vowed countermeasures, as did the European Union.
Both allies and foes united in criticism of measures they believe will deal 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 in a statement, adding the 27-member bloc was preparing to hit back if talks with Washington failed.
US Treasury Chief Scott Bessent earlier warned that any such retaliatory moves would only lead to escalation.
What do experts say about Trump’s tariffs policy?
Economists issued mixed reactions to Trump’s tariff policy.
Dan Ives, who is Wedbush Securities managing director and global head of technology research, told the New York Post that ‘it’s worse than the worst case scenario’ and to ‘expect a bloodbath in terms of the market reaction because it’s much worse than expected’.
He pointed out levies on Asia potentially being the most damaging to Americans.
‘The China and the Taiwan tariffs are the backbreakers and that will change the pricing of electronics and consumer goods in the US for years to come,’ he said.
But Macquarie Group economist and strategist Thierry Wizman told the Post, ‘I do not think the markets are going to react that terribly tomorrow. This is not the worst-case scenario, which would have been a 20% global tariff across the board.’
Wizman also said that Americans will feel some pain, including inflation.
‘I know that in Trump’s mindset, he doesn’t think the tariffs will cause inflation,’ he said. ‘But Main Street has already concluded this will cause inflation.’
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A fact sheet sent out by the White House shortly after the event wrapped up stated that Trump’s action ‘simply asks other countries to treat us like we treat them. It’s the Golden Rule for Our Golden Age’.
‘The United States will no longer put itself last on matters of international trade in exchange for empty promises,’ states the sheet.
‘Reciprocal tariffs are a big part of why Americans voted for President Trump—it was a cornerstone of his campaign from the start.’
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