At least 10% tariffs have been imposed on all imported goods into the United States from all countries on the basis of national security.
“I, DONALD J. TRUMP, President of the United States of America, find that underlying conditions, including a lack of reciprocity in our bilateral trade relationships, disparate tariff rates and non-tariff barriers, and U.S. trading partners’ economic policies that suppress domestic wages and consumption, as indicated by large and persistent annual U.S. goods trade deficits, constitute an unusual and extraordinary threat to the national security and economy of the United States. That threat has its source in whole or substantial part outside the United States in the domestic economic policies of key trading partners and structural imbalances in the global trading system. I hereby declare a national emergency with respect to this threat,” the official Executive Order states.
Different parts of the world are being subject to different tariff rates.
The UK, Australia, Türkiye and Colombia are subject to a 10% rate while other countries are being hit hard. Vietnam is subject to a 90% rate, Thailand to a 72% rate, China to a 67% rate, and so on. A more detailed list can be found here.
Tariffs apply effective from 5 April 2025 unless the goods were loaded on a ship at the port of loading and in transit on the final mode of transportation before 12:01 am U.S. Eastern Standard time on 5 April 2025.
These new tariffs are in addition to other duties, taxes, fees, or charges that are already in place. Canada and Mexico are already subject to 25% tariffs on a variety of exports and are not covered by the current round of Trump Tariffs. Meanwhile, there are some exemptions for some goods such as copper, pharmaceuticals, bullion, and minerals not available in the United States.
International container shipping analyst, Lars Jensen, commented that “shippers will be working overtime in the coming days trying to assess the impact on their business”.
Another , well-known, shipping commentator, Peter Tirschwell, has pointed out that the Trump Tariffs have the opposite effect to a range of big problems, like the Red Sea Crisis, or COVID lockdowns. Those earlier events of world importance took capacity out of the shipping market whereas the Trump Tariffs add capacity back in by suppressing demand.
Mr Tirschwell points out that global real GDP forecast for this year has been cut to 2.5% by S&P Global Market Intelligence.
“The proliferation of tariffs and related uncertainties raise the risk of a global hard landing,” according to the latest Global Executive Summary issued on March 19. S&P Global’s Purchasing Managers Indices™, now show “a loss of global growth momentum,” Tirschwell notes, adding that the container shipping rates are now in “freefall”. He points that nearly 70 services on all the world’s major trading routes, that’s the trans-Pacific, trans-Atlantic, and the Asia-Europe have experienced a cancellation of sailings.
Meanwhile, Peter Sand, Chief Analyst at Xeneta, commented that: “It is tough to make important decisions on your supply chain when the rules of the game keep changing. Many US shippers are right at the point of agreeing new long-term ocean container freight contracts coming into effect on 1 May, so this puts them in an extremely difficult position. Where will they be importing goods from in the next 12 months and which carrier should they choose?”
He added that the downward trend in ocean container spot rates is likely to continue owing to an ongoing steady market decline and subdued demand since January.
“The falling demand in February and March is partly due to increased volumes in January during the pre-Lunar New Year rush, but also because shippers are easing off from the frontloading we saw throughout 2024.
“Once the tariff situation becomes clearer and shippers begin to diversify supply chains across regions, it is possible we could see disruption in ocean supply chains and upward pressure on rates, but this may be a little further down the line.”
Since the news broke, several countries and regions around the world have vowed to take countermeasures. These include Canada, China and the EU. Meanwhile, French President Emmanuel Macron has called for a suspension of European investment in the United States. It was a particularly significant statement given that he told international media that investments announced in the last few weeks should be included. This would therefore seem to include the USD$20 billion (AUD$31.70 billion) investment over four years into US maritime, transport, logistics and supply chain capabilities over the next four years by Marseille, France-based, global ocean container shipping company, CMA CGM.
