Trump's Reciprocal Tariffs Reinstated

The Trump administration on Thursday announced that in a week's time, so-called reciprocal tariffs of between 15 and 50 percent on countries around the world will be back in effect, as a 10-percent tariff rate on most of the rest of the world will stay in place. Trump had introduced the tariffs on April 2 but paused all but the 10-percent worldwide rate almost immediately for 90 days. After some rates were adjusted in early July, Trump last week once again made changes. Seven trade deals or outlines with the EU, the United Kingdom and Asian countries reached in the past months also changed tariff rates for the nations affected.

Overall, tariffs don't reach as high now as when they were first announced. The exceptions are Brazil and India. Both are facing tariffs of 50 percent - the former to pressure the country to stop prosecuting ex-President Jair Bolsonaro, a Trump ally, and the later because of its large purchases of Russian oil. The highest rate otherwise is 41 percent on Syria, followed by Laos, Myanmar and Switzerland. Canada was hit with 35 percent on goods not covered by the United States-Mexico-Canada trade agreement, while Mexico has another 90 days to negotiate and prevent a rate higher than the current 25 percent on goods not under the trade deal. But the two U.S. neighbors are not the only nations with some exceptions. The EU, now subject to a tariff rate of 15 percent, is estimated to be paying the duty on around 70 percent of its goods exported to the U.S. due to exceptions, which other countries also have. Some goods are generally exempt from Trump's reciprocal tariffs, but they are already (or are planned to be) tariffed separately.

According to a report by ING, those countries sending a large amount of lower-priced goods like footwear, apparel or furniture to the United States were hit with above-average duties, including Vietnam, Cambodia, Bangladesh, Indonesia, the Philippines or Sri Lanka. Some of them have since negotiated rates down through trade deals, but had to make big concessions to the United States in the process. Still, their tariff rates have remained above average.

The Trump administration said in April when the tariffs were first introduced that nations levying very high tariff rates on U.S. imports or thought to otherwise engage in trade or currency practices seen as unfair by the current U.S. government were targeted by these tariffs. A release on the topic went as far as listing lower domestic consumption compared to GDP in countries like Singapore, China, Ireland or Germany as a reason to impose higher tariffs on them. The trade deficit the United States has with other countries due to its high consumption behavior and lower domestic production of goods was also repeatedly citied in the context and has been known to be a thorn in Trump's side since his first administration. Then, the country that has the highest trade deficit with the United States - China - had been the predominant target of tariffs.