Trump issues 90-day tariff pause on most countries except keeping hikes for China at 125%
WASHINGTON : US President Donald Trump on Wednesday announced a 90-day pause on his reciprocal tariff, just 24 hours after it came into effect, sparking fears of a major trade war, triggering a global market meltdown, and raising concerns of a looming global recession. However, he announced an immediate increase in tariffs on China to 125 per cent, up from the previously declared 104 per cent.
In a post on X, the White House said, “Do not retaliate and you will be rewarded.” The US President said that over 75 countries had not retaliated against the United States, and therefore he authorised a 90-day pause on the reciprocal tariff, which the Republican leader introduced as a measure to address the alleged trade imbalance with the US. “...based on the fact that more than 75 Countries have called Representatives of the United States… to negotiate a solution to the subjects being discussed relative to Trade, Trade Barriers, Tariffs, Currency Manipulation, and Non Monetary Tariffs, and that these Countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorised a 90 day PAUSE,” he wrote on TruthSocial.
He said that during this 90-day period, a significantly reduced reciprocal tariff of just 10 per cent would be in effect. However, he announced a steep hike in tariffs on China to 125 per cent from the earlier 104 percent — a move that had already drawn retaliation from Beijing.
“Based on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately. At some point, hopefully in the near future, China will realise that the days of ripping off the USA, and other Countries, is no longer sustainable or acceptable,” the US President wrote.
Following the announcement, Wall Street’s main indexes jumped, although the precise details of Trump’s plans to ease tariffs on non-China trade partners were not immediately clear. The S&P 500 stock index rose nearly 7 percent after the announcement.
Donald Trump’s ‘reciprocal’ tariffs on the US’s trading partners came into effect on Wednesday, including hefty duties on Chinese goods, escalating a global trade war. In a sharp response, China imposed an 84 per cent tariff on US goods the same day and vowed to fight the tariff war to the very end.
Further escalating the trade war between the world’s two largest economies, Beijing imposed export restrictions on several US companies and filed a fresh complaint with the World Trade Organisation (WTO), warning that the US tariffs pose a serious threat to global trade stability.
Before announcing its latest tariff hike, the Chinese Ministry of Commerce had said, “If the US insists on further escalating its economic and trade restrictions, China has the firm will and abundant means to take necessary countermeasures and fight to the end”.
Trump’s move is also seen as an attempt to narrow what had been an unprecedented trade war between the US and most of the world to one between the US and China.
The US President’s announcement of a tariff pause also came in the wake of a retaliatory tariff threat from the European Union. Joining China and Canada, the 27-member bloc said it would launch its first countermeasures against Trump’s tariffs next week, imposing 25 per cent duties on a range of US imports.