(AFP) – US President Donald Trump is poised to unveil sweeping new “Liberation Day” tariffs on Wednesday, but kept the world guessing until the last minute about the scope of an onslaught that could spark a global trade war. Trump will unveil the measures flanked by cabinet members in the Rose Garden of the White House at 4:00 pm (2000 GMT) — after Wall Street markets close — promising that they will stop America being “ripped off” and will deliver a new “golden age” of US industry.
While Trump insisted he had decided on the reciprocal tariffs hitting countries that have targeted the world’s biggest economy, the White House admitted he was still ironing out details hours before the announcement. Early Wednesday, Trump posted a one-liner on his Truth Social platform: “It’s Liberation Day in America!” The Republican billionaire has had a long love affair with tariffs, insisting in the face of economic experts that they are a cure-all that will tackle America’s trade imbalances with friends and foes alike.
Critics say US businesses and consumers could bear the burden if importers pass on the cost, adding that the policy could increase risks of a recession. “If this trade war continues through Labor Day (on September 1), the US economy will likely suffer a recession this year,” Mark Zandi, chief economist of Moody’s Analytics, told AFP. Global markets have been jittery for days ahead of Trump’s announcement, while the countries most likely in the crosshairs have called for talks — even as they ready retaliatory measures.
The move also underscores the growing and profound gulf between Trump’s America and many of its closest allies, not only on trade but on security, defense, and almost everything else. The 78-year-old US president has trailed the measures for weeks, initially suggesting that the tariffs would simply match whatever levies other countries impose. He said Monday that he would be “very kind” but gave little away. As the deadline approached, US media reported that he had been considering blanket 20 percent tariffs — and then that he was looking at a third option where some countries would get preferential treatment.
A broad 20 percent tariff on imports could cost the average US household at least $3,400, according to the Budget Lab at Yale University. White House Press Secretary Karoline Leavitt said Trump was meeting top advisors on the eve of his announcement “to make sure this is a perfect deal.” The tariffs would come into effect “immediately” after Wednesday’s roll-out, she said, effectively ruling out delays for negotiations with other countries. Trump has wobbled on several other tariff announcements since returning to office in January, blinking at the last minute with allies such as Canada and Mexico. His plans have however sparked growing fears of a painful global trade war that could drive up prices and cause widespread disruption.
European Central Bank President Christine Lagarde warned Wednesday the impacts will “unsettle the trade world as we know it,” speaking with Irish radio station Newstalk. Major economies including the European Union and Canada have vowed retaliation. The EU will react to new tariffs “before the end of April,” said the French government spokeswoman. An initial response planned for mid-April counters US action on steel and aluminum, and this will be followed by a sector-by-sector study. The spokeswoman said: “A European decision should be announced before the end of April.”
Germany warned Wednesday that trade wars hurt “both sides.” “We are going to be very deliberate in terms of the measures we take,” Canadian Prime Minister Mark Carney said Tuesday. Elsewhere, British Prime Minister Keir Starmer spoke with Trump on talks towards a trade deal, while Vietnam said it would slash duties on various goods. Other top exporters are seeking to build up alliances to counter Washington, with China, Japan, and South Korea speeding up talks on a free trade agreement. The former property tycoon insists the levies will bring a “rebirth” of America’s hollowed-out manufacturing capacity and says companies can avoid tariffs by moving to the United States. Sweeping auto tariffs of 25 percent are due to take effect April 3, after Trump earlier imposed duties on steel and aluminum imports and goods from China.
– Danny KEMP
© 2024 AFP
