Former US President Donald Trump has announced plans to introduce reciprocal tariffs next week in a bid to equalize trade relations with international partners. The move, which he revealed during a meeting with Japanese Prime Minister Shigeru Ishiba, is expected to impact multiple sectors, including automobiles, steel, and pharmaceuticals.
What Are Reciprocal Tariffs?
Reciprocal tariffs mean that if a country imposes duties on US-made goods, the US will apply the same tariff rate on imports from that country. Trump emphasized that this approach ensures fair treatment for American businesses and workers.
“We don’t want any more or any less. If they charge us, we charge them,” Trump stated in the Oval Office.
Impact on Global Trade and Key Sectors
Trump’s tariff policy could impact major US trading partners, including the European Union, Canada, and China. He specifically mentioned that automobile tariffs were under consideration, a move that could affect European and Japanese car manufacturers.
Other potential targets include:
- Steel and aluminum industries
- Pharmaceuticals
- Oil and energy sectors
Trade War Strategy: Tariffs as Leverage
Trump has long used tariff threats as a negotiation tool to secure better trade deals. His administration has previously considered:
- A 10-20% universal import duty
- Tariffs targeting specific industries
- Using trade policies to push for border security and drug control measures
His recent decision to delay 25% tariffs on Canada and Mexico raised doubts about his commitment to following through on such measures. However, he has already imposed 10% tariffs on China, though some consumer goods were exempted.
A Shift in US Trade Policy?
While Trump previously proposed a flat universal tariff, he now suggests that reciprocal tariffs are a fairer approach.
“I think that’s the only fair way to do it. That way, nobody’s hurt,” he said.
A formal announcement is expected early next week, with a press conference scheduled for Monday or Tuesday.