Business reporter, BBC News
Getty ImagesUS President Donald Trump’s sweeping new tariffs on more than 90 countries around the world have come into effect.
Moments before his deadline passed for countries to negotiate US trade deals, Trump posted on his Truth Social platform that billions of dollars were now flowing into his country as a result of his import taxes.
Trump is using tariffs to encourage jobs and manufacturing industries to return to America, among other political goals.
Separately on Wednesday, he threatened to raise the tariff on imports from India to 50%, unless that country stopped buying Russian oil. He also threatened a 100% tariff on foreign-made computer chips, to push tech firms to invest more in the US.
Trump’s trade policies have been broadly aimed at reshaping the global trading system, which he sees as treating the US unfairly. One of his key pledges as he returned to the White House in January was to cut the trade deficit – the shortfall between what America buys and what it sells.
His tariffs work by charging US importers a tax on goods they buy from other countries. Those importers may pass some or all of the extra cost on to customers.
Trump has also been accused of throwing the global economy into turmoil in recent months, though markets have recently been more stable.
The overall average US tariff rate is at its highest in almost a century, thanks to a range of other industry-specific taxes affecting products such as vehicles and steel.
The duties that came into effect on Thursday were first announced in April. Many were later paused amid market turbulence, and to give other countries time to strike new trade deals with the US.
A patchwork of rates were set for different countries – and were adjusted over time by Trump, who ultimately set a negotiating deadline of 7 August.
Export-dependent economies in South East Asia are among the hardest-hit.
Manufacturing-focused Laos and Myanmar face some of the highest levies at 40%. Some experts said Trump appears to have targeted countries with close trade ties with China.
But after more than four months of uncertainty, markets in Asia seemed to take the news in their stride on Thursday.
Major share indexes in Japan, Hong Kong, South Korea and mainland China were a little higher, while markets in India and Australia were lower.
The latest set of tariffs will offer countries some stability after months of chaos, said economist Bert Hofman from the National University of Singapore.
“This is supposed to be it,” he said. “Now you can start to analyse the impact of the tariffs.”
Some major economies – including the UK, Japan and South Korea – reached agreements to ensure goods exported to the US would face a lower tariff rate than Trump threatened in April.
The European Union has also struck a framework deal with Washington, in which Brussels has accepted a 15% tariff on goods from the trading bloc.
Switzerland has said it will hold an extraordinary meeting on Thursday after its officials were unable to reach a deal with the US.
At 39%, the tariff rate on Swiss goods is one of the highest imposed by the US, and threatens to hit the country’s economy hard.
Taiwan, a key Washington ally in Asia, was handed a 20% tariff. Its president Lai Ching-te said the rate was “temporary” and that talks with the US were ongoing.
Other tariffs unveiled by Trump after he returned to the White House in January have been aimed at the US’s top three trading partners – China, Canada and Mexico – with a variety of political goals in mind.
Last week, he boosted the tariff rate on Canada from 25% to 35%, saying the country had “failed to cooperate” in curbing the flow of fentanyl and other drugs across the US border. Canada insists it is cracking down on drug gangs.
But most Canadian exports to the US will dodge the import tax due to an existing trade treaty, the United States-Mexico-Canada Agreement (USMCA).
Higher tariffs on Mexico were paused for another 90 days as negotiations continue to strike a trade deal.
Meanwhile, the US and China have held a series of talks in a bid to agree an extension to a 90-day tariffs pause due to expire on 12 August.
Some of Trump’s recent tariff moves have been bound up with a separate effort to end Russia’s war in Ukraine.
He has threatened to impose “secondary tariffs” aimed at Moscow’s trading partners if a ceasefire with Ukraine is not agreed by Friday, although it is unclear whether positive noises following talks between Washington and Moscow and a potential meeting between Trump and Putin will affect this.
In the interim, Trump threatened on Wednesday to raise the tariff rate on Indian goods to 50% from 27 August, as he pushes the world’s third largest importer of energy to stop buying oil from Russia.
Delhi called the move “unfair, unjustified and unreasonable” and vowed to protect its national interests.
The move marked a “sharp change” in Trump’s approach to Moscow that could spark concerns among other countries in talks with the US, said market analyst Farhan Badami from financial services firm eToro.
“There is the possibility here that India is only the first target that Trump intends to punish for maintaining trade relations with Russia,” Mr Badami said.
Also on Wednesday, Trump said he would impose a 100% tariff on foreign-made semiconductors.
That threat came as tech firm Apple announced a new $100bn (£75bn) US investment after coming under pressure from the White House to move more production to the US.
Major chipmakers that have made significant investments in the US appear to be able to dodge the new tariff. Government officials in Taiwan and South Korea have said in separate statements that TSMC, SK Hynix, and Samsung would be exempt from the new levy.
The White House did not immediately respond to a BBC request for clarification.
The BBC has also contacted SK Hynix and Samsung. TSMC declined to comment.
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