Donald Trump had the world’s leading economies on edge Tuesday as the US president prepared to unveil a promised raft of tariffs that could trigger a cascading global trade war.
Trump kept rivals and allies alike guessing about who would be targeted and by how much, but promised to be “very kind” when addressing what he has dubbed “Liberation Day” on Wednesday.
Global stocks remained volatile ahead of the so-called “reciprocal tariffs,” which Trump says are necessary to combat unfair trade imbalances with countries that target the United States.
The Republican billionaire, a fan of tariffs for decades, said on Monday night that he had “settled” on a plan but kept the world in suspense as he refused to reveal the details.
Trump would only say that the tariffs would be lower than what other countries would be charging the United States, adding that “we sort of have a world obligation perhaps.”
“We’re going to be very nice, relatively speaking, we’re going to be very kind,” he said in the Oval Office.
Trump is set to hold a “Make America Wealthy Again” press conference in the Rose Garden at the White House at 4:00 pm (2000 GMT) on Wednesday.
Critics warn that the strategy risks a global trade war, provoking a chain reaction of retaliation by major trading partners like China, Canada and the European Union.
America’s neighbors Canada and Mexico were already gearing up but suffered amid the uncertainty.
“No one knows what’s going to happen,” Carrie McEachran, head of the Sarnia Lambton Chamber of Commerce on the US-Canada border, told AFP. “It’s tough to put together a concrete plan.”
Brussels, which Trump has accused of trying to “screw” the United States, said Tuesday it still hoped to negotiate a solution — but that “all instruments are on the table” to retaliate if necessary.
British Prime Minister Keir Starmer spoke with Trump on “productive negotiations” towards a UK-US trade deal. Vietnam said on Tuesday it would slash duties on a range of goods to head off Trump tariffs.
Trump’s advisors have pitched imposing a 20 percent global tariff to hit almost all US trading partners, the Wall Street Journal reported, while the White House suggested Monday they might be “country specific.”
The US president, who began his second term in office in January, claimed the tariffs will drive the “rebirth” of America as a manufacturing giant and stop it being “ripped off.”
But his plans have caused huge uncertainty, jolting markets around the world and stoking fears of recession at home in America and abroad.
Wall Street dipped on Tuesday but European and Asian stock markets rose as investors waited nervously for the announcement. Safe-haven gold touched a fresh record high.
US stocks on the S&P 500 and Nasdaq indexes have now had what is their worst quarter since 2022. US manufacturing shrunk again in March amid the uncertainty.
Trump’s threatened tariffs have prompted other targets to gird themselves. China, South Korea and Japan formed a rare alliance at the weekend, agreeing to strengthen free trade between themselves.
Trump has already imposed a range of tariffs on key economic rivals since returning to the White House.
Last week he announced a 25 percent tariff on all auto imports, while a 25 percent tariff on steel and aluminum from around the world came into effect in mid-March
China was hit in March by additional 20 percent tariffs on all goods, triggering retaliatory duties from Beijing. The EU has unveiled is own measures to start mid-April.
Trump has however delayed tariffs on goods from Canada and Mexico.
But the threat of a trade war has caused increasing political ructions, with Canada’s looming general election on April 28 set to be dominated by how to deal with Trump, who has also called for the United States to annex Canada.
