Trump Escalates Trade War With Sweeping Tariffs, Targeting Global Economies

On April 2, US President Donald Trump escalated his trade war to new heights by announcing final tariffs that are significantly more aggressive than when he first began the tariff war early in his presidency.

His latest move includes a sweeping 10 per cent across-the-board tariff on imports, as well as country-specific tariffs designed to match 50 per cent of the rates that those nations impose on American goods.

As a result, India now faces tariffs of 26 per cent, the European Union 20 per cent, and Vietnam a staggering 46 per cent. China, already embroiled in an ongoing trade dispute with the US, will be hit with tariffs of at least 54 per cent, further intensifying tensions between the two economic giants.

One of the most disruptive aspects of Trump’s decision is the closure of a long-standing loophole that allowed foreign manufacturers, particularly in China, to ship goods worth less than $800 into the US without tariffs.

This change will have profound consequences for the global e-commerce industry, making it costlier for American consumers to purchase goods from international sellers. Trump, a long-time critic of free trade, has framed these measures as necessary to protect American manufacturing and reduce trade imbalances.

Unlike many nationalists who blame foreign leaders for taking advantage of their country, Trump directs his criticism at past US administrations, accusing them of failing to secure fair trade deals. However, his attempt to rectify what he sees as historical injustices may cause more harm than good.

Despite warnings from economists and financial analysts, Trump appears unfazed, insisting that his ultimate success will be measured by the revitalisation of US factories. The tariffs will significantly raise prices of consumer goods, as many essential imports from countries like Bangladesh and Vietnam will become more expensive.

Inflation, which had been gradually returning to the Federal Reserve’s 2 per cent target, is now expected to surge beyond 4 per cent before the end of the year. This could weaken consumer purchasing power and slow economic growth.

Trump’s economic worldview seems to be rooted in a misplaced nostalgia for the 19th century, when America operated under a heavily protectionist trade regime. However, history tells a different story. The US reached its peak economic influence not through isolationism but through active participation in global trade during the latter half of the 20th century.

Ironically, had Trump looked further back, he would have realised that India, not America, held nearly 25 per cent of the world’s GDP in the 18th century, only to lose its dominance due to colonial policies. By portraying the world’s most powerful and wealthiest nation as a victim that must “fight back”, Trump risks isolating the US from its closest allies and trade partners.