It’s been a whirlwind week in the trade war, with business owners and investors trying to respond after the US imposed a sweeping 25% tariff on all steel and aluminum imported into the country at midnight on Wednesday.
Here’s how it played out: Hours before enacting the latest tariffs, Trump reversed a threat to double the rate on steel and aluminum from Canada, the US’s top source of imports for the metals. Instead, steel and aluminum from there will be subject to the 25% levy.
Who’s impacted? The tariff on steel and aluminum marks the first time in Trump’s second term that a tariff has been applied to all countries.
Before Wednesday, Trump had only enacted tariffs that applied to China, Mexico and Canada this term. In the case of Mexico and Canada, businesses can avoid paying tariffs through April 2 if they comply with the USMCA.
How have countries responded? The European Union swiftly retaliated by announcing just hours later that it would impose duties on 26 billion euros ($28 billion) worth of American goods in response to the “unjustified” tariffs. The countermeasures were “swift and proportionate,” it said in a statement.
Shortly before they went into effect, Australian Prime Minister Anthony Albanese criticized the tariffs as “entirely unjustified” and “against the spirit of our two nations’ enduring friendship,” but said Canberra will impose no reciprocal levies.
China is the only country whose aluminum and steel will be tariffed at rates higher than 25%. That’s because a 20% across-the-board tariff on Chinese imports was already in effect prior to Wednesday, and the 25% steel and aluminum tariff will be tacked on top of that, bringing the total tariff rate to 45% on steel and aluminum from there.
