Chaos in the trade war Trump gives in on tariff dispute - but not for China
The US President is taking a wrong turn on economic policy. He surprisingly suspends tariffs that have just been imposed and instead insists on negotiations. Only one country is under further pressure.
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- US President Donald Trump has announced a 90-day pause in the tariffs that have just come into force on the "Truth Social" platform.
- The uniform tariff rate of ten percent for all countries, which came into force before the country-specific tariffs, will remain in place during the pause. This means that the tariff rate for the EU, which was previously raised to 20%, will now be halved again.
- However, this does not apply to China, where Trump even raised the tariff again - to a total of 125%.
US President Donald Trump is rowing back in the international trade conflict and suspending certain tariffs that have just come into force for 90 days. Trump wrote on the "Truth Social" platform that he had ordered a 90-day pause and that a reduced tariff rate of ten percent would apply during this period.
However, this explicitly does not apply to China: instead, Trump raised the tariff on Chinese imports once again - to a total of 125%.
Trump's surprising and brief announcement on social media caused some confusion and left many questions unanswered. Just a few days ago, the US President had declared war on trading partners around the world with a huge tariff package.
In a first step, the USA recently introduced new blanket tariffs of ten percent on imports from almost all countries. For many countries, significantly higher so-called reciprocal punitive duties were introduced in a second step, depending on the trade deficit. Imports from Germany and other European Union countries into the USA were thus subject to new tariffs totaling 20%.
Markets recently on a downward spiral
However, following major turbulence on international stock markets, Trump has now relented. US government representatives suggested that the pause would apply to country-specific tariffs at different levels. The uniform tariff rate of ten percent for all countries that had previously come into force will remain in place during the pause. This means that the tariff rate for the EU will now also be halved.
Negotiations with the affected countries are to take place during the 90-day break. From the outset, one of Trump's aims was to use the tariffs to force other countries to dismantle trade barriers for imports from the USA.
"There will be a 90-day pause in reciprocal tariffs while these negotiations are ongoing," explained White House spokeswoman Karoline Leavitt. The tariff level will be reduced to a general rate of ten percent. The announcement sent the US stock markets soaring in late evening trading.
US Treasury Secretary Scott Bessent tried to portray Trump's approach as a success - it was his strategy that had brought more than 75 countries to the negotiating table. Bessent also addressed the market fluctuations that Trump's tariff policy had caused in recent days. The stock markets are now getting more certainty, he argued.
The White House had recently firmly rejected speculation about a possible suspension of the huge US tariff package, describing it as "fake news". Rumors to this effect had caused a stir, particularly on social media, and strong fluctuations on the stock markets.
EU launches counter-tariffs
The EU member states had previously cleared the way for initial counter-tariffs of between 10% and 25% in response to the tariffs imposed by US President Donald Trump. Next week, special duties on jeans and motorcycles from the USA, among other things, will come into force, according to a communication from the EU Commission.
Further counter-tariffs are to follow in mid-May and at the end of the year - these will affect foodstuffs such as beef, poultry and citrus fruits such as oranges and grapefruit. At the beginning of December, it will be the turn of nuts and soybeans.
According to the EU, the first tariffs will affect a trade volume of 3.9 billion euros. On May 15, tariffs will be imposed on goods worth 13.5 billion and the third wave will affect a volume of 3.5 billion.
The planned EU special tariffs are not a reaction to the so-called reciprocal tariffs, but to new US tariffs on steel and aluminum imports imposed around a month ago.
Tariff rate of 125 percent for China
Meanwhile, the tariff conflict between the US and China continues to escalate. Trump wrote that due to China's lack of respect for global markets, he was increasing the tariff on imports from China to 125% with immediate effect.
Beijing had recently announced counter-tariffs of the same magnitude in response to a previous US tariff increase of 50 percent - the special tariffs on all US imports will now amount to 84 percent and come into force on Thursday, the Chinese leadership announced. The People's Republic has already threatened several times to respond to US tariffs with its own measures.
With his aggressive tariff policy, Trump is spreading great uncertainty on the markets worldwide. The US president wants to use tariffs to correct alleged trade imbalances and shift production to the US. At the same time, the tariff revenues are to be used to at least partially finance the tax cuts promised during the election campaign.
EU also relies on negotiations
When announcing the first counter-tariffs, the EU Commission emphasized: "These countermeasures can be suspended at any time if the US agrees to a fair and balanced negotiation outcome." At the beginning of the week, EU Trade Commissioner Maros Sefcovic had said that plan A was to focus on negotiations - a decisive response was plan B. The aim is to negotiate, Sefcovic emphasized on Monday.
EU Commission President Ursula von der Leyen had also emphasized on Monday that the European Union was ready for talks despite US President Donald Trump's tariff decisions. The offer to the USA: an agreement on the mutual lifting of all tariffs on industrial goods - which the Americans have already rejected. According to von der Leyen, possible countermeasures would be prepared in the event of negotiations failing.
