In April, Donald Trump announced new import tariffs, which were largely put on hold due to market panic. Four months later, Trump is highlighting what he claims are significant achievements, including new agreements with some trading partners and unilateral tariffs on others, all while avoiding the major financial disruptions seen previously.
Trump asserts that his policies will generate new revenue, boost domestic manufacturing, and attract billions in foreign investment. However, the actual long-term outcomes and potential negative consequences of these measures remain unclear.
A deadline of August 1 was initially set for countries to negotiate new trading terms, with warnings of potentially severe tariffs for those that did not comply. Despite high expectations from officials like trade adviser Peter Navarro, by the end of July, Trump had announced only around a dozen deals, many of which lacked detailed provisions.
The UK has been among the first countries to negotiate with the US, facing a baseline tariff of 10% on most goods. While this was seen as manageable compared to the 15% imposed on countries with larger trade deficits, countries such as South Korea and Cambodia are also adapting to new tariffs.
Uncertainty surrounding tariffs has diminished in some aspects, allowing businesses to resume planning and investment activities. Yet, analysts warn that the average US tariff has increased significantly, potentially damaging global economic dynamics. The immediate effects vary by country; while India may experience minor growth impacts, Germany could face more significant slowdowns due to its automotive sector.
Tariff agreements are still incomplete for crucial trading partners like Canada and Taiwan, and several proposals remain verbal or unsigned. The effectiveness of Trump’s overarching aim to revitalize American production and jobs remains in question, highlighting concerns that long-term ramifications may alter established trading patterns with important allies.
Source: https://www.bbc.com/news/articles/c0l6g13rlwko?at_medium=RSS&at_campaign=rss