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On April 2, United States President Donald Trump unveiled a 10% universal import duty on all goods entering the U.S., as well as sweeping new tariffs on a wide array of imported goods from 60 nations, branding the action “Liberation Day.”
Trump used 1977 International Emergency Economic Powers Act to declare a national economic emergency and implement the tariffs without U.S. Congress approval. Tariff rates will jump from 2.5 to 22%, reaching levels that have not been seen since Acts during the Great Depression, according to experts.
Intended to boost domestic manufacturing and reduce trade deficits, the tariffs span sectors from consumer electronics to raw materials, with rates ranging from 10% to over 100%. They include a 34% tariff on China, 20% tariff on the European Union, 24% on Japan, and 26% on India, among others. However, amid sharp market reactions, diplomatic backlash, and concerns from U.S. industries, the administration issued a 90-day pause on most of the tariffs—with notable exceptions for those imposed on Chinese imports. This temporary delay has given governments and businesses alike a short window to assess and respond to the looming disruption of global trade dynamics.
The initial announcement triggered swift and widespread reactions from trading partners around the world. China, the primary focus of the most severe tariffs, responded with increased duties of up to 125% on U.S. goods such as soybeans, aircraft parts, and semiconductors. According to the World Trade Organization, U.S.-China merchandise trade could fall by as much as 80% in 2025 if the full range of tariffs goes into effect, with potential global trade contraction estimated at 1.5% in more severe scenarios. European leaders also voiced concern. Germany, one of the largest exporters to the U.S. within the European Union, emphasized the potential for trade disruptions in sectors like automotive and machinery, while EU officials acknowledged that retaliatory options were under discussion as part of a broader review of transatlantic trade policy.
Mexico, a close trading partner under the United States-Mexico-Canada Agreement (USMCA), responded by stating it may consider targeted countermeasures if negotiations fail to produce a resolution. Mexican officials signaled that tariffs between 5% and 20% on U.S. agricultural and industrial products were being reviewed, while also emphasizing a preference for resolving disputes through diplomatic and institutional channels. Although the Mexican government has not yet applied any retaliatory tariffs, it has expressed concern over the potential implications for regional supply chains and cross-border investment, especially if automotive components and manufacturing inputs are affected in future rounds.
For businesses with global supply chains, the uncertainty surrounding the tariffs and the 90-day pause has prompted contingency planning. Apple Inc., which relies heavily on Chinese manufacturing, faces potential cost increases if tariffs on electronics components are reinstated. The company has begun examining the feasibility of shifting more assembly operations to alternative countries in Asia, a move that reflects broader trends in supply chain diversification. Similarly, Boeing, a major U.S. aerospace exporter, is assessing the risk of reduced demand from markets like China and the European Union, where retaliatory measures could complicate future sales. While it remains unclear how much of Boeing’s order book would be affected, trade tensions have added another variable to an already complex global aviation market.
Whether the current pause results in a renegotiated approach or a full resumption of tariffs, global businesses are bracing for a more uncertain, more divided trade environment—and adapting accordingly.
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