The president announces import taxes on nearly all global markets, triggering a drop in the dollar and threats of international retaliation.
Guacamaya, April 2, 2025. President Donald Trump proclaimed a historic shift in U.S. trade policy on Wednesday by signing an executive order imposing “reciprocal” tariffs on countries with which the U.S. runs trade deficits, including key partners like Mexico, Canada, and the European Union.
“This is one of the most important days in our country’s history. It is our declaration of economic independence,” Trump declared, dubbing the measure “America’s Liberation Day.”
The announcement sent shockwaves through currency markets: the dollar fell 1% against the euro and weakened against the British pound and Swiss franc. The tariffs will affect at least 10% of the value of nearly all imported goods, with higher rates for nations that, according to Trump, “have been subsidized by the U.S. for years.”
The European Union, China, Japan, and South Korea have already warned of retaliation, while analysts caution about the risk of a global trade escalation. Trump defended the tariffs as an effort to revitalize domestic industry and correct trade imbalances, but critics argue they could raise prices for American consumers amid economic fragility.
Who is Affected?
In Latin America, Venezuela will face 15% tariffs, while Colombia and Brazil will see 10%. The hardest-hit neighbor will be Guyana, with a 38% tax on its trade with the U.S.
The tariffs specifically target countries with the largest trade deficits with the U.S. Canada and Mexico, partners in the USMCA, are included despite their economic integration. The move marks a departure from decades of free trade and could redefine global supply chains.
While the administration celebrates its “strategic protectionism,” the international community is bracing for a battle that many fear will create more losers than winners.
Certain sectors will be exempt or receive discounts, including steel, aluminum, copper, auto parts, lumber, energy, semiconductors, pharmaceuticals, and minerals not available in the U.S.
