Trump slaps tariffs on key allies as global trade talks intensify
Through an executive order issued this week, Trump imposed new import duties ranging from 10 percent to 50 percent on goods from 69 trading partners, including Canada, Brazil, India, Taiwan, and Switzerland. The tariffs will take effect in seven days, just ahead of the August 1 deadline.
The measures include a 35 percent tariff on many Canadian goods, 50 percent for Brazil, 25 percent for India, and 20 percent for Taiwan. An exception has been granted for shipments already in transit. Goods from countries not listed will face a blanket 10 percent U.S. import tax, potentially more in the future, Trump indicated.
"Some trading partners, despite having engaged in negotiations, have offered terms that, in my judgment, do not sufficiently address imbalances," the executive order stated, adding some also failed to align with U.S. economic and national-security priorities.
Markets reacted with relative calm, a contrast to the selloff that followed Trump's earlier tariff threats in April. Still, stocks and equity futures edged lower in Asian trading.
The administration says additional trade deals are in the works as part of a broader strategy to close trade deficits and support U.S. manufacturing.
Canada was hit particularly hard. Trump raised tariffs on Canadian goods tied to fentanyl-related enforcement to 35 percent, up from 25 percent, claiming Ottawa had "failed to cooperate" on narcotics enforcement. "Canada has been very poorly led," Trump told reporters. Canada's government has not yet responded, but it previously contested the basis for such tariffs.
Mexico, meanwhile, received a reprieve. Trump granted a 90-day delay on new 30 percent tariffs for most Mexican non-automotive and non-metal goods covered by the U.S.-Mexico-Canada Agreement (USMCA), following a call with President Claudia Sheinbaum.
"We avoided the tariff increase announced for tomorrow," Sheinbaum posted on X, calling the call with Trump "very good." However, U.S. tariffs on Mexican steel, aluminum, copper, and non-USMCA-compliant autos remain in place.
India now faces a 25 percent tariff following stalled negotiations over agricultural market access. Trump also raised concerns about India's purchases of Russian oil. Talks are ongoing, but New Delhi has pledged to protect its farm sector. The news triggered backlash from India's opposition and a drop in the rupee.
Brazil was hit with a 50 percent tariff amid tensions over the prosecution of former President Jair Bolsonaro, a Trump ally. Still, specific sectors such as energy, aircraft, and orange juice were spared.
Commerce Department data showed that tariffs may already be driving up prices: home furnishings rose 1.3 percent in June, recreational goods 0.9 percent, and clothing and footwear 0.4 percent.
Meanwhile, Trump's legal justification, using the 1977 International Emergency Economic Powers Act, faced tough questioning in federal court. Judges appeared skeptical that trade deficits and fentanyl enforcement constitute emergencies under the law.
Following preliminary progress in earlier talks, China now has until August 12 to finalize a broader tariff agreement with Washington.
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