Trump said tariffs on all U.S. import taxes are at least 10%, with a target rate of up to 50% – which will help the U.S. regain an industrial base, which he said has withered for decades of trade liberalization.
“This is the only chance our country has to reset the table, because no other president is willing to do what I’m doing, and even through it,” he told reporters at the White House. “Now, I don’t mind browsing it because I saw a beautiful picture at the end.” Trump spoke for hours after confronting China, the world’s second economy.
Trump said he would have a 50% obligation to import from China in the U.S. if the 34% tariff imposed on U.S. products last week was not withdrawn. These Chinese tariffs are in response to Trump’s announcement of a “reciprocity” duty.
Beijing responded with resistance. Liu Pengyu, spokesman for the Chinese Embassy, said Trump’s threat was “a typical move of unilateralism, protectionism and economic bullying.”
“We have stressed more than once that pressure or threatening China is not the right way to interact with us,” he added. “China will firmly protect its legitimate rights and interests.” Meanwhile, the European Commission proposed a 25% anti-tax on a range of U.S. goods, including soybeans, nuts and sausages, although other potential items, such as bourbon, are left out of the list. Officials said they were ready to negotiate a “zero” agreement with the Trump administration. “Sooner or later, we will find mutually acceptable compromises in the negotiations with the United States,” EU Trade Commissioner Maros Sefcovic said in a press conference. The 27-member group is struggling with tariffs on cars and metals that are already in place and faces 20% tariffs on other products on Wednesday. Trump also threatened to call the EU alcoholic beverage.
Politico reported that U.S. Treasury Secretary Scott Bessent met with Trump in Florida on Sunday, urging him to emphasize a stunning trade deal with partners to give the market a final game of attitude towards U.S. strategy.
Trump said his administration will hold trade talks with Japan, one of Washington’s closest allies, and administration officials said dozens of other countries have also reached out to hope to put tariffs up to 50%, which will take effect on Wednesday. Back and forth inject further turmoil into global financial markets, which have been steadily declining since Trump’s announcement.
Trump administration officials said the president is following a promise that it will reverse decades of trade liberalization, which he believes has weakened the U.S. economy.
“He is doubling down on what he knows is effective, and he will continue to do that,” White House economist Kevin Hassett said in Fox News. “But he will also listen to our trading partners, and if they come to us with the advantage of a very favorable American manufacturing and American farmers, I’m sure he will listen.” China’s retaliation for taxation is the most determined reaction to the Trump announcement, which has been condemned by other leaders. China’s sovereign funds stepped in to try to stabilize the market after the walls of stocks in mainland China and Hong Kong on Monday. Taiwan’s share price fell nearly 10% – the largest one-day rate fell record.
Wall Street leaders warned about U.S. tariffs, JPMorgan CEO Jamie Dimon said they could continue to have negative consequences, while fund manager Bill Ackman said they could lead to a “nuclear winter.” Ackman is one of the few Trump supporters who question the strategy. Billionaire Elon Musk, who leads Trump’s efforts to cut government spending, calls for zero tariffs between the United States and Europe over the weekend.
On Monday, Trump trade adviser Peter Navarro regarded Tesla’s CEO as a “car assembly.”
A new reality or a negotiation strategy?
Investors and political leaders have been working to determine whether Trump’s tariffs are permanent or stressful strategies to win concessions from other countries. Some in the EU are concerned that a strong reaction could potentially strike more back at the rebound of European exporters, from French cognac and Italian wines to German cars. Volkswagen’s Audi holds cars that arrive at U.S. ports after April 2 as new automatic tariffs are imposed. According to a Reuters letter, aircraft parts supplier Howmet Aerostace may stop some cargo if affected by tariffs.
Some governments in Asia have expressed their willingness to participate. Taiwan President Lai provided zero tariffs as the basis for talks on Sunday, while Indian government officials said Delhi did not intend to retaliate. Now, investors bet that the growing recession risk could prompt the U.S. Federal Reserve to lower interest rates as early as next month. Trump repeated calls for central banks to lower interest rates on Monday, but Fed Secretary Jerome Powell has so far shown that he is not in a hurry.
