 "A trader works as a television screen shows news about US President Donald Trump's trade and tariff policies, on the floor of the New York Stock Exchange (NYSE) at the opening bell on April 10, in New York City. AFP")
Ask Donald Trump what’s the most beautiful word in the dictionary and the US president will respond with the word tariff.
Since returning to the White House in January, US President Donald Trump began proposing hefty tariffs on all trading partners — whether friend or foe — and since then it’s been a see-saw of tariffs being imposed and then paused.
All this back-and-forth on tariffs by the US president has caused quite a lot of confusion and sent the world markets on a rollercoaster ride.
If you have had trouble keeping up with the chaotic tariff actions and threats, here’s a rundown of all that’s happened — from which tariffs are in effect, which aren’t and what’s to come in the near future.
Trump offers tariff reprieve on electronics… for now
In Trump’s long war on tariffs, the White House on Friday (April 11) announced an exemption on smartphones, computers and some other electronic devices, including from China. As per a notice published by the US Customs and Border Protection, the exemption applies to products entering the United States or removed from warehouses as early as April 5.
The news came as a big relief for tech companies such as Apple , as majority of their products are assembled in China and the tariffs would push the prices of their iPhones, iPads and other items to exorbitant highs. “This is the dream scenario for tech investors,” Dan Ives, who is the global head of technology research at Wedbush Securities, posted on X. “Smartphones, chips being excluded is a game-changer scenario when it comes to China tariffs.”
However, that relief was short-lived as Commerce Secretary Howard Lutnick told ABC News on Sunday that the tariff reprieve was temporary. “(Electronics are) exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two.
And Trump amped up the fear on Sunday when he posted on his social media platform that no one was “getting off the hook.” He said that there were no exceptions to the tariffs, as smartphones, laptops and other products were still subject to an existing 20 per cent duty and the items were being moved to a different tariff “bucket”.
“We will not be held hostage by other countries, especially hostile trading nations like China,” Trump said in a post on his Truth Social platform.
Speaking to reporters on board Air Force One later on Sunday, Trump said he would announce new tariffs on semiconductors over the next week. “The tariffs will be in place in the not distant future,” Trump said, adding that there would be flexibility for some companies in the sector.
Trump blinks on tariffs, barring China
Prior to his Sunday warning of a semiconductor tariff, Trump, on April 9, shocked the world when he abruptly paused import tariffs for 90 days on dozens of countries — except China.
The U-turn came after widespread market chaos, prompting Trump to post “Be cool. Everything is going to work out well.” However, four hours after writing this, the US president blinked, announcing on social media that he would pause for 90 days higher trade tariffs for most countries, excluding China.
Reflecting on his tariff pause, Trump said that the markets had looked “pretty glum” and that people were “getting a little bit yippy.”
But this didn’t mean that all tariffs were withdrawn. The White House said that a baseline tariff of 10 per cent was still in effect. Also, 25 per cent tariffs on all car imports to America, including from the UK, were also still in place. Moreover, 25 per cent tariffs on steel and aluminium imports, including products made from these metals were in effect as well as 25 per cent on many imports from Mexico and Canada. A tariff on countries importing Venezuelan oil remained in effect.
Trump’s continued tariff war against China
While Trump announced a 90-day pause on tariffs, he didn’t include China in the exemption . In fact, he hit the Asian giant with even steeper tariffs on April 9, citing a “lack of respect” by Beijing.
“Based on the lack of respect that China has shown to the world’s markets, I am hereby raising the tariff charged to China by the United States of America to 125 per cent, effective immediately. At some point, hopefully, in the near future, China will realise that the days of ripping off the USA, and other countries, is no longer sustainable or acceptable,” wrote Trump on Truth Social.
The 125 per cent tariff was an increase from the previous 104 per cent after China announced additional retaliatory tariffs of 84 per cent against the United States earlier Wednesday. Announcing the same, China’s Ministry of Commerce said in a statement, “If the US insists on further escalating its economic and trade restrictions, China has the firm will and abundant means to take necessary countermeasures and fight to the end.”
The tariff war between the world’s two biggest economies ratcheted even further a day later when the White House clarified that the 125 per cent tariff on Chinese goods was in addition to a 20 per cent tariff that Trump had already imposed on China, bringing the total tariffs on China imposed by the Trump administration to 145 per cent.
And it seems neither party is in the mood to back down with it being reported that China suspended the export of several critical rare earth elements, metals and magnets. The New York Times reported that shipments of the magnets, essential for assembling everything from cars and drones to robots and missiles, have been halted at many Chinese ports while the Chinese government drafts a new regulatory system.
EU strikes back at Trump tariffs and then it doesn’t
When Trump announced his ‘Liberation Day’ tariff plan on April 2, he announced a 20 per cent duty on goods coming from the European Union. This prompted president of the European Commission, Ursula von der Leyen, to announce reciprocal tariffs targeting more than €20 billion of US products including soybeans, motorcycles and beauty products.
“These countermeasures can be suspended at any time, should the US agree to a fair and balanced negotiated outcome,” a commission statement said.
However, a day after Trump announced his pause on tariffs, on April 9, the EU also suspended its retaliatory 25 per cent tariffs with the EU president saying, “We want to give negotiations a chance. If negotiations are not satisfactory, our countermeasures will kick in.”
And now, the Politico reports that the EU will revive its offer to buy more American gas. Officials told the media outlet that the EU has been open about their desire to consume more American fuel, framing it as a way for the continent to finally sever all energy links with warmongering Russia.
Cost of Trump’s tariffs
It’s not yet fully clear what has been the true economic impact of Trump’s on-again, off-again tariffs. However, Bloomberg in its one report said the stock market rout wiped over $10 trillion off major markets across the globe.
But, it has surely sowed seeds of uncertainty and doubt across the world. As US Senator Elizabeth Warren said, “Nobody can figure out what the rules will be five days from now, much less five years from now.”
And many others voiced their concern over the uncertainty. Billionaire investor Ray Dalio called Trump’s trade policies “very disruptive” so far. But it “could be part of a process,” he added. “It depends on where we are at the end of the 90 days.”
Meanwhile, JPMorgan has said that the odds of America witnessing a recession are at 60 per cent, up from 40 per cent, whereas Goldman Sachs has predicted that America’s chances of a recession now stand at 45 per cent.
With inputs from agencies