What are "reciprocal tariffs"? The core idea is to impose tariffs on imported goods that are equivalent to the tariffs or trade barriers that other countries place on U.S. exports. The administration argues this creates a "level playing field."
* Implementation: The new tariffs are being implemented through a series of executive orders. Initially, a baseline tariff of 10% was announced on imports from most trading partners, with higher, country-specific rates for some nations. More recently, the administration issued an executive order modifying and adjusting these rates for many countries.
* Tariff Rates: The new tariff rates vary significantly by country, with some facing rates as high as 41% and others having lower rates. These rates are determined based on factors like a country's trade deficit with the U.S. and its "strategic alignment." The new tariffs are applied in addition to existing duties.
* Negotiations and Exceptions: The policy has prompted a series of trade negotiations. Some countries, such as the European Union and Japan, have reached agreements with the U.S. that resulted in lower, though still significant, tariffs than initially threatened. Other countries that have not negotiated or are considered to have large trade deficits with the U.S. have faced the steepest increases.
* Impact: The new tariffs have been described as a "seismic" shift in global trade. The administration states that the tariffs are intended to protect American industries and jobs and generate revenue for the U.S. government. However, critics and some analysts warn that they could lead to higher prices for consumers, disrupt global supply chains, and potentially trigger a wider trade war.