First Female to Lead Federal Reserve

On October 9, 2013, President Obama nominated Federal Reserve Vice Chairman Janet Yellen as the next Chairman of Federal Reserve. A historic and eventful eight-year streak of Ben Barnanke will end on January 31, 2014.

On January 6, 2014, Janet Yellen was confirmed by the Senate by 56-26 vote, with all the opposition votes being casted by the Republican Senators. Yellen takes over on February 1, 2014 from Ben Barnanke.

Trade Treaties and Talks; Tariffs

NAFTA

NAFTA went into effect in 1994.

Annual Trade Numbers (in billion $$):

According to U.S. Census Bureau and Statistics Canada,

Annual
* Export from U.S. to Canada: 246
* Import from Canada to U.S.: 255
* Export from U.S. to Mexico:212 (from TX $92.5)
* Import from Mexico to U.S.: 271 (to TX $84)
* Export from Canada to Mexico: 6
* Export from Mexico to Canada:14

NAFTA Trucking Rule

On October 21, 2011, first fleet of Mexican trucks entered into interior parts of the USA, almost 11-and-1/2 years after the originally scheduled timeline. Under NAFTA, signed in 1994, Mexican trucks would have access to highways in border states by 1995 and full access to all U.S. highways by January 2000. However, until now, Mexican trucks have seldom gotten access to beyond a border buffer zone. During George W. Bush's administration, a limited number of the Mexican trucking companies were allowed to participate in a pilot program that had allowed access to U.S. interior. After Barack Obama was elected, the pilot program was cancelled in 2009. The Mexican government responded by imposing $2 billion worth of tariff on 99 U.S. imports, including Christmas trees, onions, oranges, apples, juice concentrates, toothpaste, deodorant and sunglasses. Mexico reduced the tariff after signing the trucking agreement with the USA in July 2011, and removed altogether on October 21, 2011. At present 11 Mexican trucking companies are going through the certification process.

******************************** NAFTA RENEGOTIATION ***********************

NAFTA Renegotiation Begins

U.S., Canadian and Mexican officials on August 16, 2017 launched the renegotiation process of NAFTA at Washington, D.C. U.S.T.R. Robert Lighthizer is leading the U.S. officials.

First Round Concludes with Promise of Follow-up Rounds, Quick Wrap-up

Cognizant of national elections in Mexico and the United States next year, the five-day (August 16-20, 2017), first round of NAFTA talks concluded on August 20, 2017 at Washington, D.C. with a joint communique that stressed on upgrading the agreement by establishing the "21st century standards to the benefit of our citizens". The press statement also called for an accelerated and comprehensive negotiation process. The second-round will be held in Mexico between Sep 1-5, 2017, and the following round will then move to Canada for a late September 2017 session.

Third Round of NAFTA Re-Negotiation Talks Concludes without Thorny Issues

The third-round of NAFTA re-negotiation talks concluded on September 27, 2017, and during this round, U.S.T.R. Robert Lighthizer apparently did not even introduce some of the contentious topics that Trump administration had been fretting over. The third round, held in the Canadian capital of Ottawa, dealt and made significant progress on issues such as competition policy, digital trade, state-owned enterprises and telecommunications, according to Canadian Foreign Minister Chrystia Freeland. One of the contentious topics is NAFTA's Chapter 19 that calls for an arbitration panel to mediate any dispute among parties that Washington came to despise, but Canada and Mexico favored it. Another contentious topic is related to "local content-rules", and Trump administration was in favor of tightening the rules to ban any product from outside the region to have label "made in North America" just because it is assembled in Mexico. The fourth-round will be held in Washington D.C. October 11-15, 2017.

Sixth Round of NAFTA Re-negotiation Ends without any Concrete Results

Sixth round of talks on revising current version of NAFTA ended on February 2, 2018 at Washington without yielding any tangible results. The seventh round of NAFTA re-negotiation will begin at the end of February 2018.

Trump Pushes for Sunset Clause

President Donald Trump's June 8, 2018, bilateral session with Canadian Prime Minister Justin Trudeau at the Quebec resort town of La Malbaie, venue of G-7 summit, covered NAFTA and his insistence on putting a five-year sunset clause as part of renewal of the landmark trade deal involving U.S., Canada and Mexico. Trump on June 9, 2018 told correspondents before heading out to Singapore for a landmark summit with North Korean leader Kim Jung Un that his meeting with Trudeau on NAFTA renewal went really well. However, Trump did not forget to issue a stern warning that if he found the NAFTA not to be working in favor of U.S., he would tear up the deal and instead go for separate deals with Mexico and Canada.

Canada, U.S. Reach NAFTA Renewal Deal a Month after U.S. and Mexico Agreed

A frenetic series of talks between officials from Ottawa and Washington reached an agreement late September 30, 2018, hours before October 1, 2018 deadline, to resuscitate the flagging NAFTA and put it on track. Trump administration and Mexico reached a deal in August 2018 to renew NAFTA with some significant tweaks, and threatened to put the deal in effect without Canada if no agreement was reached with Ottawa by September 30, 2018. Under the deal with Canada, U.S. dairy will have less restrictive trade barriers in getting access to lucrative markets in the north while Trump administration dropped its earlier insistence that a dispute resolution panel be scrapped. For the time being, the automobile tariffs imposed by both nations will continue. Among the biggest tweaks done to NAFTA were provisions that included:

* A revision of sunset clause proposed by Trump administration

* Auto parts to be allowed for duty free shipment across the borders should have a larger percentage to be made in the high-wage factories

President Hails the new NAFTA

President Donald Trump said at the Rose Garden on October 1, 2018 that the U.S.-Mexico-Canada Agreement, or USMCA, will close "many deficiencies and mistakes" of NAFTA. Although Trump gave the trilateral deal a new name, to many it's still NAFTA.

NAFTA Replacement Deal Signed on the Sidelines of G-20 Summit at Buenos Aires

Leaders of the USA, Canada and Mexico signed a landmark agreement on November 30, 2018 on the sidelines of G-20 summit at Buenos Aires that would replace the quarter century-old NAFTA, pilloried by Donald Trump as the worst trade agreement in the U.S. history. The agreement signed by Donald Trump, Justin Trudeau and outgoing Mexican President Enrique Pena Nieto is called the U.S.-Mexico-Canada Agreement, or USMCA. NAFTA will continue to be effective until legislatures in three countries ratify the USMCA.

******************************** NAFTA RENEGOTIATION ***********************

Trump Delays Tariffs on Auto, Lifts Metal Tariffs

In pursuit to sway Congress to approve U.S.-Mexico-Canada Agreement, or USMCA, renegotiated version of NAFTA, Trump administration tried its latest trick to appear bold while indirectly sending conciliatory message to Congress as Trump administration announced on May 17, 2019 two key trade-related declarations made hours apart:

* It will delay for up to six months the imposition of tariffs on the imports of autos and auto parts from Mexico and Canada

* It will lift tariffs on steel and aluminum imports from Canada and Mexico effective May 19, 2019

In June 2018, Trump administration leveraged an obscure trade clause, Section 232 of the Trade Expansion Act of 1962, allowing the Commerce department to take steps in the interest of national security to impose tariffs on steel and aluminum imports from Canada ($14 billion) and Mexico ($3.5 billion). Canada will also lift the punitive tariffs imposed as a retaliation on $13 billion in U.S. imports. However, the tariffs on auto and auto parts will have much more devastating impact as U.S. imported $192 billion in vehicles and $159 billion in auto parts from its neighbors. 

Trump Threatens to Impose Tariffs on Mexican Imports

President Donald Trump on May 30, 2019 pulled the trigger of tariff in a shocking way and surprising rationale that he would impose 5 percent tariff on Mexican imports beginning June 10, 2019 unless Mexico didn't take appropriate measures to prevent Central American migrants from coming to the U.S. President Donald Trump's threat has come with a tweet, reflecting the cavalier way he mixes foreign policy, trade policy and immigration policy. Trump didn't stop at 5 percent tariff. He went beyond that threatening to impose incremental tariffs every month up to 25 percent. The threat has thrown the newly minted NAFTA, formally called the U.S.-Mexico-Canada Agreement, or USMCA, in limbo as it awaits Senate ratification. As of 2018, U.S. has imported $346.5 billion in goods from Mexico while exporting $265 billion in goods. Many experts are having hard time how immigration and trade are getting messed up in a volatile political atmosphere. 

Mexican President Andres Manuel Lopez Obrador tried to defuse the escalation on May 31, 2019, ordering his Foreign Minister Marcelo Ebrard to head to Washington next week to hold talks with U.S. Secretary of State Mike Pompeo.

Deal Reached to Avert Tariffs on Mexican Imports; Business Chamber Warns against Traiffs
A long-drawn grueling talk helped avert a trade disaster as negotiators from USA and Mexico were able to reach an agreement on June 7, 2019 to limit the foot traffic of migrants heading northward through Mexico. U.S. President Donald Trump tweeted on June 7, 2019, saying that the tariffs were "indefinitely suspended". Hours before the agreement was reached, U.S. Chamber of Commerce issued a statement on June 7, 2019 on behalf of more than 140 business and agricultural bodies, warning Trump administration of the "harm" that tariffs would do to "U.S. consumers, workers, farmers and businesses of all sizes across all sectors".
The June 7, 2019, agreement between Mexico and the U.S. is more like a compromise of what each nation wants, with more tilt in favor of the U.S. demand. Under the deal,
* Mexico will deploy about 6,000 newly created National Guards troops in the southern border with Guatemala to prevent Central American migrants crossing into Mexico
* Trump administration gets the buy-in from AMLO administration to expand Migrant Protection Protocol that will force migrants to stay on the Mexican soil while their asylum cases will go through the U.S. immigration system
* Trump administration concedes and now will not insist on the "safe third country" issue that requires Central American migrants to request for refugee status in Mexico before filing asylum to the U.S. authorities
The lead architect of the agreement on the Mexican side, Foreign Minister Marcelo Ebrard, expressed satisfaction for averting the tariffs on Mexican imports. President Andres Manuel Lopez Obrador was ebullient too, calling for a victory rally at Tijuana on June 9, 2019. The rally was originally billed as protest rally to decry U.S. effort to impose tariffs on Mexican imports.

Questions on Tariff Avoidance Deal Linger
As both Donald Trump and Andres Manuel Lopez Obrador took victory laps on June 8, 2019, there were several questions on both sides of the borders what actually this deal was all about. The deal was overwhelmingly focused on the enforcement component while a scant few sentences were spared in a jointly issued statement to drive home the point that there were more work to be done to promote growth, security and development in the Northern Triangle--Guatemala, Honduras and El Salvador. For Mexico, deployment of 6,000 National Guards troops to control migration was anything but normal. However, the Interior Secretary Olga Sanchez Codero said that the [deployment] plan was all the way in the planning stage even before the tariff threats were issued. The central element to creation of Mexican National Guards was to provide security to Mexican people, and President Andres Manuel Lopez Obrador had presented the concept to Congress in March 2019 as such. It was never presented as a border security apparatus, and therefore, lacks training and expertise to perform border security tasks.
Another key element of the June 7, 2019, Mexico-U.S. deal is the expansion of Migration Protection Protocol to require asylum seekers to stay in Mexico while their cases would be processed in the U.S. The program has been rolled out in California and El Paso, and as of today, 10,393 were returned to Mexico since the Migration Protection Protocol had been launched in January 2019. Currently most of the returnees are being taken care of by the Catholic Church, and if the programs is completely rolled out along the border, nobody is sure how Mexico is going to cope up with the surging population who are going to stay in Mexico for indefinite time.

TRANS-PACIFIC PARTNERSHIP (TPP)

President Barack Obama had to shelve joining an important trade negotiation that covers almost 40 percent of the world trade because of the first federal government shutdown in 17 years. Instead Secretary of State John Kerry will pitch in on behalf of President Obama in the Trans-Pacific Partnership talks to be held in Bali, Indonesia on October 8 and October 9, 2013. The 12-nation TPP talks will be held in the aftermath of 21-nation APEC (Asian-Pacific Economic Co-operation) ministerial-level meeting that has ended on October 5, 2013. TPP bloc is looking for not only eliminating the tariff to the goods and services, but also smoothing the trade rules for non-tariff trades. New Zealand PM John Key will lead the October 8-9, 2013 trade talks in absence of Obama. TPP includes (1) Australia, (2) Brunei, (3) Canada, (4) Chile, (5) Japan, (6) Malaysia, (7) Mexico, (8) New Zealand, (9) Peru, (10) Singapore, (11) the USA and (12) Vietnam.

On October 9, 2013, the epicenter of Pacific politics shifted from Bali to Brunei as the Association of Southeast Asian Nations summit had begun at Bandar Seri Begawan. US Secretary of State John Kerry will fill in on behalf of President Obama in both the ASEAN summit as well as to-be-followed East Asian Summit, that will also be hosted in Brunei.

House Provides Renewed Push to President's Fast-Track Authority
After torpedoing a measure last week that would renew president's fast-track authority, under which Congress may either vote up or down a trade treaty, but can't change it, House of Representatives on June 18, 2015 has approved a measure that will renew president's Trade Promotion Authority as negotiations over Trans-Pacific Partnership get more intense in the coming months. In a twist of fate, President Obama's landmark trade agenda is being fought against tooth and nail by organized labor, liberals and environmentalists, his one-time trusted constituency. On the other hand, Congressional Republicans, who have made opposition to President Barack Obama on almost every issue a rallying cry, are lining up to provide the necessary support to his trade agenda. 28 Democratic House members balked the partisan pressure to join the majority Republicans to approve the TPA measure by 218-208 vote.

Senate Votes to Give President "Fast-Track" Authority
Senate Republicans, often odd with President Obama on almost all issues since the very beginning of his administration, on June 23, 2015 presented him with a legacy-setting legislative victory by renewing the Trade Promotion Authority under which President Obama could fast-track Trans-Pacific Partnership talks and sign an agreement that Congress could only vote up or down, but not amend it. The June 23, 2015, procedural vote in the Senate was 60-37. The Senate needs to vote the measure one more time to send it to President Obama's desk. Senate has three more related trade bills to work on, including Trade Adjustment Assistance (TAA) meant to provide help and re-training to American workers impacted by trade deals.

Senate Sends the First-Track Authority Bill to President
Twelve days after House Democrats torpedoed the presidential fast-track authority in a vote on June 12, 2015 by voting down their close-to-heart measure TAA, Senate Republican leadership made a strategic adjustment to the measure by splitting TPA from TAA, and went ahead to pass the TPA first. A day after the procedural vote, the Senate on June 24, 2015 passed the "fast-track authority", which Obama's predecessors had enjoyed, by 60 to 38 vote. The measure now goes to President for his signature. Under the fast-track authority, Obama administration will negotiate the possible Trans-Pacific Partnership deal that Congress can only vote up or down, but not change it.

House Votes for Trade Adjustment Authority Measure; Renews African Growth Measure
After sending the "fast-track" authority measure to President Barack Obama, Congressional action on June 25, 2015 reverted to the House as lawmakers voted 286-138 to renew the job retraining program for displaced workers because of trade deals. Republican lawmakers also voted in drove to support the job training measure, contradicting their historical stand in the past. Another landmark legislative piece that got approved on June 25, 2015 by the House was renewal of African Growth and Opportunity Act.

Trans-Pacific Partnership Agreement Reached
After marathon round of talks at Atlanta, trade representatives from 12 Pacific rim countries on October 5, 2015 reached a landmark agreement after 5 years of often intense and bickering negotiation that would create the world's largest free-trade zone encompassing 40 percent of global economy. The deal will eliminate tariff on more than 18,000 products exported by American manufacturers, and cut taxes assessed on imports. Lauding the deal, President Barack Obama said on October 5, 2015 that when 95 percent of the customers lived outside the USA, it would be naïve to give China the leverage to write trade rules by not passing a landmark agreement as Trans-Pacific Partnership agreement. The U.S. Trade Representative Michael Froman too chimed in on October 5, 2015, saying that the deal was different from previous trade agreements as it had incorporated workers' safeguards, environmental protection and fair labor rules. In addition to the USA, the partnership includes (1) Australia, (2) Brunei, (3) Canada, (4) Chile, (5) Japan, (6) Malaysia, (7) Mexico, (8) New Zealand, (9) Peru, (10) Singapore and (11)Vietnam. Each nation has to ratify the deal. In the USA, Obama administration has to give Congress 90-day notice and lawmakers 60-day timeline before signing the deal.


President Trump Signs Executive Order to Withdraw from TPP
Making good on his campaign promise, President Donald Trump on January 23, 2017 signed an Executive Order, setting in motion a process to withdraw from the TPP.

TPP Agreement's Name Gets Changed

Trade ministers of the 11 of 21-nation APEC bloc on November 11, 2017 re-committed to the free trade and commerce as enshrined in the Trans Pacific Agreement, but rechristened the accord to Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPATPP).

CPATPP Signed san USA
Trade ministers from 11 Pacific Rim nations--Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam--that account for 13 percent of global economy signed a sweeping trade deal, Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPATPP), a re-christened version of TPP that President Donald Trump had led the U.S. to withdraw last year, on March 8, 2018 at Santiago, Chile that would provide 500 million people with opportunities and prosperity based on what Japanese Economy Minister Toshimitsu Motegi had described as "free and fair 21st century rules in the Asia-Pacific region"

TRUMP'S TARIFF PROPOSAL
Trump to Impose Tariff
Delivering one of the key campaign promises, President Donald Trump on March 1, 2018 said at a hastily arranged conference with industry executives that his administration would impose 25 percent tariff on steel imports and 10 percent tariff on aluminum imports.

Allies Rile at Trump's Tariff Proposal
A day after President Trump proposed 25 percent tariff on steel import, and 10 percent tariff on aluminum imports, the reaction from U.S. allies was swift and caustic. John Weeks, Canada's chief NAFTA negotiator, said during the day that Trump's tariff proposal was not looked upon favorably by Canadians. China and EU were more blunt as they said that billions of dollars of U.S. imports would be slapped with tariff too. The prime targets include Kentucky bourbon and Haley-Davidson motorcycle which has plant in Speaker Paul Ryan's Wisconsin.

Tariff War Likely to be Fueled by Sabre Rattling
Undeterred by forceful response by allies, U.S. President Donald Trump upped the ante on March 3, 2018 in the tariff war of words, tweeting that he would like to impose tariff on European auto imports. Currently, U.S. imposes 2.5 percent tariff on imported cars and a 25 percent tariff on the imports of foreign trucks and commercial vans. European Union slaps a tariff of 10 percent on U.S. exports of cars.

Trump Signs Tariff Orders
Defying warnings from home and abroad, President Donald Trump went ahead on March 9, 2018 to sign orders to impose 25 percent tariffs on steel imports and 10 percent tariffs on aluminum imports although carving out exemptions for Canada and Mexico as NAFTA re-negotiation was undergoing. The new tariff regime will go into effect in 15 days.

Last Minute Exemptions Granted to Several Nations in Aluminum and Steel Tariffs
As 25 percent tariffs on steel imports and 10 percent on aluminum imports were about to take hold on March 23, 2018, Trump administration carved out several nations for exemption and targeted mostly Chinese imports. Last minute exclusions included E.U., Brazil, South Korea, Canada and Mexico. The exemption will be effective till May 31, 2018 by which the allies have to come up with remediation steps although no one knows what those will be. Australia may be added to the exemption list soon.

Trump Vows to Stop Chinese Pilfering of U.S. Proprietary Asset; Impose Tariff
After imposing 25 percent tariffs on steel imports and 10 percent on aluminum imports--although making a last-minute carve-out for E.U., Brazil, South Korea and Mexico--that would go into effect on March 23, 2018, U.S. President Donald Trump trained his eyes on China, especially for doing too little to discourage the theft of American technology and intellectual asset. Trump on March 23, 2018 vowed to impose tariffs on at least 1,300 Chinese imports to the tune of $60 billion. Trump ordered U.S. Trade Representative Robert Lighthizer to compile the list of Chinese imports within 15 days. Reacting to a fear of prolonged trade war between the world's largest two economies, DOW tumbled 724 points during the day. However, the March 22, 2018, concession came with a caveat for those nations: they have until May 1, 2018 to come up with a satisfactory deals with the U.S.

Trump Scores a Trade Victory with a One-on-One Deal with South Korea
The New York Times reported on March 27, 2018 that a one-on-one negotiation-driven trade deal with South Korea would be announced on March 28, 2018, reflecting President Donald Trump's proclivity toward negotiating and notching up deals with individual nations instead of multilateral trade deals that had become norm in recent years. The reported South Korea-U.S. trade deal, among others, calls for:
* Opening the South's market for U.S. car manufacturers such as General Motors and Ford
* Extending tariffs to South Korean truck exports
* Limiting the South Korean steel exports to two-third of the current volume

China Announces Imposition of Tariffs on more than 100 U.S. Imports
Plunging the bilateral relations between China and the U.S., Chinese authorities on April 2, 2018 announced imposition of tariffs on $3 billion in U.S. imports, covering more than 100 items. 25 percent tariffs will be imposed on aluminum and pork imports, while a 15 percent tariff will be imposed fruits, nuts, wine, herbs and pipes. The U.S. stock markets were roiled during the day after China had announced imposition of tariff, with Standard and Poor's 500 Index dropping 2.23 percent and undergoing the so-called market correction. The April 2, 2018, Chinese action to impose tariffs on $3 billion in U.S. imports was in response to Trump administration's recent decision to impose tariffs on steel and aluminum imports from China.

China's Tariff List Includes Items that Texas Banks on for Exports
On April 3, 2018, Trump administration laid out a detailed list of about 1,300 Chinese imports to the tune of $50 billion that would be slapped with tariff as part of penalties on $50 billion in Chinese imports. Not to be left behind, China on April 4, 2018 unveiled its own list of items as part of its tariff penalty of 25 percent on $50 billion in U.S. imports. Many of the items are the core of Texas' agro-economy such as soybeans. China had also targeted small aircraft imported from the U.S.  In addition to soybeans and small aircraft, the list includes beef, whiskey, passenger vehicles and chemicals. This list of $50 billion in U.S. imports that China had targeted for 25 percent tariffs was separate from the list unveiled on April 2, 2018 when Beijing slapped another 25 percent tariff on additional $3 billion in imports.

Trump Dials up Pressure, Orders USTR for Tariffs on Additional $100 billion in Chinese Imports
Never known for lying low, President Donald Trump on April 5, 2018 upped the ante in the looming trade conflict with China, ordering the U.S. Trade Representative Robert Lighthizer to create an additional list of $100 billion in Chinese imports for slapping tariffs. 

Tariffs to be Imposed on Canadian, Mexican, EU Imports 

As no breakthrough was possible during the exemption period, now 25 percent tariff on steel imports and 10 percent on aluminum imports will be slapped on Mexico, Canada and EU on June 1, 2018, dialing up the pressure on USA's allies days before a crucial G-7 Summit in Quebec, Canada.

Mexico Hits Back with Its Own Tariff
In a trade retaliatory measure, Mexico on June 5, 2018 imposed tariffs on $3 billion of U.S. exports, targeting many of the items made, or grown, in Texas. The items upon which Mexican tariffs are to be imposed include whiskey, cheese, pork and other goods, making good on the promise that it will hit back for Trump administration's tariffs on steel and aluminum imports.
Meanwhile, in another twist of trade talks among Canada, Mexico and the USA over renewing NAFTA, President Trump's chief economic adviser, Larry Kudlow, speaking on Fox and Friend, said on June 5, 2018 that the president now favored a country-country trade deal instead of tri-lateral NAFTA.

Trump Notches up Trade War with China
Trump administration on June 15, 2018 went ahead full throat to impose tariff on $50 billion in Chinese imports to deter what Trump called in a tweet a system that's "very unfair, for a very long time". The initial list that was drawn in April 2018 was refined and published by the Office of the U.S. Trade Representative. Under the tariff plan that involves a total of 1,102 categories of Chinese imports, 25 percent tariff will be imposed on $34 billion of Chinese imports drawn from the April 2018 list, while the $16 billion of new imports items have been identified. Tariffs on the first $34 billion of Chinese imports will go into effect July 6, 2018, while the remaining $16 billion of Chinese imports targeted will go through additional review. In retaliation, Chinese Commerce Ministry announced that it would also slap tariffs on U.S. imports in two phases. First phase of $34 billion in imports, including automobiles, seafood and agricultural products, will be targeted for tariff the day U.S. will impose the tariff on the first batch of Chinese products. The second targeted batch of $16 billion will be subject to further review, according to Chinese Commerce Ministry.

Trump Orders U.S.T.R to Make an Additional List of $200 billion Chinese Imports for Tariff
Escalating the trade war with China by several notches, Donald Trump on June 18, 2018 night ordered his Trade Representative Robert Lighthizer to draw an additional list of $200 billion Chinese imports for 10 percent tariff on the top of $50 billion imports that would be subjected to 25 percent tariff effective July 6, 2018. However, China's retaliatory tariffs have deeper implication on Texas exports. 60 percent of U.S. soybean exports go to China, and a large share of them is shipped by Texas. Also, the U.S. tariff penalty may have two-edged sword: U.S. companies have invested a cumulative $256 billion in China since 1990 vs. Chinese companies $140 billion in the U.S, according to Rhodium Group research firm and National Committee on U.S.-China Relations. To cope with tariff battle, U.S. companies will pass the cost of tariffs on imports to American consumers, while Chinese companies with the investment in the U.S. will slow down the hiring.

Trump's Tariff Raises Questions beyond Economics
As The Dallas Morning News has carried a report on June 28, 2018 on the implication of tariff battle between U.S. and other nations, there are numerous questions on how and why Trump administration is using the so-called national security concern under Section 232 of the Trade Expansion Act of 1962. The provision allows the president to bypass Congress altogether and impose sanctions on the violating nations.

Tariff Battle Begins with China
Trump administration's steep tariff of 25 percent on $34 billion Chinese imports went effective on July 6, 2018, with Beijing hitting back with dollar-for-dollar tariff retaliation that had targeted soybean and sorghum exports from Texas. On July 5, 2018, a day before the new tariff regime on $34 billion in Chinese imports went into effect, President Donald Trump threatened to slap tariff on all of the Chinese imports, i.e., nearly $500 billion in Chinese imports, a scenario that would have catastrophic impact on global economy and companies such as Wisconsin-based Husco International, which makes parts for Ford, General Motors, Caterpillar and John Deere, already suffering under the current punitive tariff regime would be disproportionately affected.

$12 billion Aid Package Announced for American Farmers
To help American farmers wither tariffs from China and other nations, Trump administration on July 24, 2018 announced a $12 billion aid package under a Depression-era program, called Commodity Credit Corporation, to help reduce the pain from the counter-tariffs. Announcing the aid, to be effective beginning in September 2018, Agriculture Secretary Sonny Perdue said that "other nations can not bully our agricultural producers to force the United States to cave in". Trump administration does not need Congressional approval for this aid package as Commodity Credit Corporation can borrow up to $30 billion from the Treasury Department without Congressional mandate.

U.S.T.R. Publishes $16 billion in Chinese Imports to be Subjected to Tariff
The office of the U.S. Trade Representative on August 7, 2018 published a list of 279 Chinese products, down from original list of 284 items, to be slapped with 25 percent of tariff effective August 23, 2018. The U.S. already imposed 25 percent tariff on $34 billion in Chinese imports effective July 6, 2018 that drew an immediate in-kind retaliation from Beijing. The $16 billion additional Chinese imports to be hit by 25 percent tariff effective August 23, 2018 will surely be matched by dollar-by-dollar counter-tariff. In addition, U.S.T.R. is reviewing option to slap 10 percent tariff on an additional $200 billion in Chinese imports.

Tariffs Become Effective on $16 billion in Imports
As planned, $16 billion in additional Chinese imports were subjected to tariff effective August 23, 2018. China responded with a tit-for-tat measure.

Trump Announces 10 Percent Tariff on Additional $200 billion in Chinese Imports
Trump administration on September 17, 2018 announced a 10 percent tariff on $200 billion in Chinese imports. This time the consequences of the tariffs will be felt across the board as a vast number of consumer goods and daily essentials will be impacted. China didn't sit idle, and the following day, September 18, 2018, announced a tit-for-tat 10 percent tariffs on $60 billion in U.S. exports. President Donald Trump, reacting to Chinese counteraction, threatened to impose tariffs on all of Chinese imports.

90-day Truce in Trade War Announced

U.S. President Donald Trump and Chinese President Xi Jinping headlined a high-octane dinner diplomacy on December 1, 2018 night at Buenos Aires on the sideline of G-20 summit. At the steak dinner, both sides agreed to a 90-day truce in deteriorating trade war between world's two largest economies. Under the deal, Trump administration will not increase the tariffs on $200 billion in Chinese imports from the current 10 percent to 25 percent effective January 1, 2019. China will reciprocate by buying an additional, unknown amount of U.S. goods and services. China will also label fentanyl as a "controlled substance" as a humanitarian gesture. Both nations will use the 90-day period to close their gap.

Trade Talks Begin Beijing
As the March 2, 2019, deadline looms large for another bout of trade tariff on $200 billion in Chinese imports slated to be increased from the current level of 10 percent to 25 percent, trade negotiation between Chinese and American officials has begun on February 14, 2019 at Beijing. U.S.T.R. Robert Lighthizer is leading the U.S. delegation, while the Chinese negotiators are led by the Vice Prime Minister Liu He.

Trade Talks Shift to Washington
After making what U.S. Trade Representative Robert Lighthizer said "some headway" in Beijing last week, U.S. negotiators and their Chinese counterparts resumed negotiation at Washington on February 19, 2019 amid optimism that President Donald Trump would extend the deadline for reaching a trade deal with China by March 1, 2019 to avoid an increase in tariff rom 10 percent to 25 percent on $200 billion in Chinese imports. On February 21, 2019, the mid-level negotiation will be amped up by participation of key Cabinet officials from both nations. On the U.S. side, Robert Lighthizer, Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross are expected to join with China's trade point-person, Liu He, a vice premier and confidant of President Xi Jinping.

Trump Extends China Tariff Deadline
President Donald Trump on February 24, 2019 declared that the threatened tariff hike from 10 percent to 25 percent on $200 billion in Chinese imports would be delayed as there was substantial progress during the weekend talks between Chinese and U.S. trade negotiators in Washington. Trump's February 24, 2019, tweet helped set aside another trade battle with China for the time being as the March 2, 2019 12:01AM, deadline loomed large and trade talks in Washington had been extended. The trade talks focused on various items of U.S. concern such as opening the Chinese markets for U.S. products, U.S. trademark and intellectual property protection and other issues of national security.

Trade Talks to Resume in China in the Third Week of March 2019
According to several reports based on White House information on March 19, 2019, trade talks between China and the U.S. will resume next week. U.S.T.R. Robert Lighthizer will lead the U.S. delegation in Beijing in the next week's talks.

Trump Threatens to Slap Tariffs on Chinese Imports
U.S. President Donald Trump on May 5, 2019 blamed Chinese negotiators for not making enough progress in the ongoing trade talks and threatened to increase tariffs from 10 percent to 25 percent on $200 billion of Chinese imports. The May 5, 2019, Trump tweet surprised trade experts and business interests of the both nation as the consequences of such action could be unimaginable harm to the respective economies and global stock market. President Trump deferred tariff increase twice in the past, January and March 2019. The new tariffs are to go into effect at 12:01AM on May 10, 2019. What's concerning more is Trump's threat to go after an additional $325 billion in Chinese imports which were not currently covered by the present tariff regime. That will definitely entail a precipitous decline in equity markets and may likely down-spiral global economy.


China Stays Stubborn, Lays out Conditions for a Trade Deal with USA
The day tariffs on $100 billion in Chinese imports were increased from 10 percent to 25 percent, China laid out clear terms for a negotiated trade deal with the Trump administration. As trade negotiation wound down in Washington D.C. on May 10, 2019, China's chief trade negotiator and Vice Premier Liu He said that U.S. should remove all tariffs in the first place, set a rational quota for China for imported goods from the USA in line with the demand and accord "dignity" to Beijing before a meaningful trade deal could be signed.

China Retaliates with its Own Tariffs
China on May 13, 2019 slapped tariffs in the range of 5 percent to 25 percent tariffs on a diverse portfolio of about 5,200 American imports with a price tag of $60 billion, leading the U.S. stock markets into tailspin. The tariffs will be effective on June 1, 2019. Although Trump administration announced last year to give American farmers $11 billion in aid to mitigate the sufferings stemming from the Chinese decision to impose tariffs last summer, the new trade war could be catastrophic for both the world's largest two economies. Oxford Economics estimated that higher tariffs would lower the U.S. economic growth by 0.3 percent, an equivalent of $490 per household.

Trump Announces $16 billion Aid for U.S. Farmers
To help American farmers overcome the hardship stemming from America's great trade war, Trump administration on May 23, 2019 announced $16 billion in aid to American farmers. The $16 billion farm aid came on the top of $12 billion in aid that Trump administration had announced in July 2018.

Trump Administration Puts a Hold on Tariffs on Chinese Exports
When Trump administration increased tariffs on $200 billion in Chinese imports in May 2019 from 10% to 25%, it had also issued a dire warning to go after the remaining $300 billion in Chinese imports and slap 10% tariffs effective September 1, 2019. Given the softening of the economy and not so stellar back-to-school retail outlook, the United States Trade Representative's Office on August 13, 2019 said that it would delay imposing 10% tariff on $300 billion in Chinese imports from September 1, 2019 to December 15, 2019.

Trade Tiff Torpedoes Stock Market; Trump Calls Powell "Enemy"
The August 23, 2019 turned out to be an extraordinary day in the history of trade war as the day began unravelling with Chinese announcement of imposing 5% and 10% tariffs on $75 billion in the U.S. imports--to be effective September 1, 2019 and December 1, 2019--in retaliation to earlier U.S. tariffs. An enraged Trump took to twitter on August 23, 2019 to blast the Chinese decision and said that he would raise planned tariffs on $300 billion in Chinese imports from 10% to 15%. President Trump also ordered the U.S. companies with operations in China to find alternative nations to do business, not explaining what had meant. He doubled down his frustration by unloading his ire on Feds Chairman Jerome Powell, calling him out with an unprecedented name-calling, "enemy", for raising the interest rates. Trump administration's Trade Representative's Office said that it would raise the existing tariffs from 25% to 30% on $250 billion in Chinese imports beginning October 1, 2019.
 However, the most lucrative part of Trump's ire was the tweet that had American companies "are hereby ordered to immediately start looking for an alternative to China". Trump has even backed up his order to American companies to look for alternative to China by referring to the Emergency Economic Powers Act of 1977, an act that gives the president a wide leeway to control the international commerce during national emergency although experts don't consider the current situation as anywhere near to national emergency.

A Timeline of Trump Trade War

* January 22, 2018: Trump administration okays tariffs on $8.5 billion in solar import panels and $1.8 billion in washing machines

* March 23, 2018: Trump administration implements tariffs on $48 billion in steel and aluminum imports, but exempts key allies

* April 2, 2018: China retaliates with its own tariffs on $2.4 billion in U.S. imports

* June 1, 2018: Trump ends metal tariff exemptions for Canada, Mexico and EU

* June 5, 2018: Mexico retaliates with levies on $3 billion in imported U.S. goods

* June 22, 2018: EU retaliates with import tariffs on $3.2 billion in U.S. imports

* July 1, 2018: Canada hits back with its own tariffs on $12 billion in U.S. imports

* July 6, 2018: Trump implements tariffs on $34 billion in Chinese imports over Chinese trade practices and China retaliates with tariffs on $34 billion in U.S. imports

* August 23, 2018: Trump imposes tariffs on $16 billion in Chinese imports and China hits back with same scale of punitive measure

* September 24, 2018: Trump implements tariffs on $200 billion in Chinese imports and China retaliates with tariffs on $60 billion in U.S. imports

* May 10, 2019: Trump implements the tariff increase from 10 percent to 25 percent on $200 billion in Chinese imports, and China follows suit with tariffs on $60 billion in U.S. imports

* May 19, 2019: Trump removes tariffs on aluminum and steel from Canada and Mexico, and both nations withdraw retaliatory tariffs

* June 7, 2019: Trump backs down on imposing tariffs on all Mexican imports after Mexico agrees to take measures to prevent migrant flow to the U.S.

* Aug 23, 2019: Trump declares new tariffs on China with new, phased-in timeline

******************************* U.S.-CHINA PHASE I TRADE AGREEMENT
U.S., China Agree on Phase I Agreement
U.S. and China agreed to not imposing upcoming tariffs on each other's imports as what President Donald Trump had called a "Phase I" agreement. The October 12, 2019, preliminary agreement calls for delaying imposition of U.S. tariffs on Chinese imports in exchange of China's commitment to buy up to an additional $50 billion in U.S. farm goods. As the 13th round of U.S.-China trade talks are being held in Beijing, a Chinese Commerce Ministry spokesman, Gao Feng, said on November 7, 2019 that a "phased cancellation" of tariffs should be the goal.

Trump Approves Phase I of the Trade Deal
Averting a disaster, U.S. President Donald Trump on December 12, 2019 approved the so called Phase I of U.S.-China trade agreement. Under the deal, China will import $50 billion in U.S. farm products. In exchange, U.S. will not impose new tariffs on $160 billion in Chinese imports and existing tariffs on $360 billion in additional Chinese imports will be reduced. However, the more controversial issues over Chinese practices of pressuring U.S. technology companies to hand over the technological knowhow if they want to do business in China and widespread U.S. intellectual property theft will be pushed forward to some other days in future. The Phase I of the trade deal will be signed in days to come.

Trump Lauds Phase 1 Deal; Gives Tariff Reliefs to Chinese Imports
U.S. President Donald Trump tweeted on December 13, 2019, calling out the victory that he had scored for American manufacturers and farmers as Beijing would make "massive" purchases as part of Phase 1 trade agreement between China and U.S. Trump also iterated that he would not levy a proposed new tariffs on $160 billion in Chinese imports and reduce tariffs from 15 percent to 7.5 percent on $112 billion in Chinese imports.

China Drops Tariff Threat against U.S. Imports
The December 13, 2019, Phase I trade agreement between the U.S. and China is a step in the right direction as China stated on December 15, 2019 that it would not slap a 25% tariff on the auto imports from the U.S., making the total tariff to 40% on auto imports.
******************************* U.S.-CHINA PHASE I TRADE AGREEMENT

U.S. Imposes Tariffs on European Imports as part of WTO Verdict
As World Trade Organization ruled in favor of the U.S. in a key case involving European subsidy to Airbus, U.S. imposed a $7.5 billion in tariff in European goods effective October 18, 2019. However, there is a twist to this: first, a 10% levy will be imposed on airplanes from Europe. If that's not going to add up to $7.5 billion, which is the case here, a myriad of European imports, including cheese, wine and others, will be subjected to punitive tariffs.

Trump Announces $20 billion Aid to Farmers to Mitigate Trade War Fallout
President Donald Trump on November 27, 2019 bypassed Congress and leveraged a 1940s era law that had been used by previous administrations to provide farm reliefs during the Dust Bowl and Great Depression era to announce a $20 billion package to soften the blowback on his very reliable constituency, American farmers, because of trade tiff. However, the package ranges as little as $2 to individual farmers and as high as $1 million to corporate enterprises.

Trump Declares Imposition of Tariffs on Argentina, Brazil, France
An early morning tweet on December 2, 2019 woke the global business and trade community up with U.S. President Donald Trump announcing steep tariffs on aluminum and steel imports from Latin America's two of the largest economies--Brazil and Argentina--to punish them for currency devaluation. President Trump also announced up to 100% tariffs on French imports to respond French tax on U.S. tech companies.
Hours later, U.S. Trade Representative Robert Lighthizer released the findings of a five-month investigation into France's digital taxes that had hurt the U.S.-based companies and must be responded by up to 100% tariffs on $2.4 billion in French imports such as yogurt, cheese, sparkling wine and makeup. At issue is so called "GAFA Tax", or Google-Apple-Facebook-Amazon tax, a 3% tax that French government imposed on the U.S.-based digital companies last year as they were deemed to be paying much less tax for the revenue generated from the French consumers.
As far as two Mercosur nations are concerned, Brazil's economy barely grew in the past year, increasing a meager 0.2%, and its central bank had cut interest rates three times since August 2019. Argentinian economy is faring even worse.
Donald Trump, on the other hand, provided $28 billion in farm relief to counter tariff effect, effectively doling out almost twice the taxpayer money given to the struggling automakers at the peak of Great Recession.

U.S., France Détente on Tariff War
On the sideline of World Economic Forum in Davos, French Finance Minister Bruno Le Maire worked out a compromise with U.S. Treasure Secretary Steve Mnuchin on tariffs and a 3% French tax on U.S. technology companies' revenue generated in France. Bruno said on January 22, 2020 at Davos that under the compromise, France would delay collecting the 3% tax until December 2020 and U.S. would hold off imposing tariffs on French imports. 

*************************************** RCEP ************************************

World’s Largest Trading Bloc Formed

After rounds of some intense negotiations originally aimed at bringing the world’s 3.6 billion people under a singular trade umbrella, 15 nations on November 15, 2020 signed an agreement to establish the world’s largest trading bloc, Regional Comprehensive Economic Partnership, or RCEP. The agreement was signed virtually on the sidelines of ASEAN Summit in Vietnam. The 15-nation RCEP consists of 10 nations from Association of Southeast Asian Nations—Cambodia, Indonesia, Laos, Myanmar, the Philippines, Thailand, Brunei, Singapore, Malaysia and Vietnam—plus five other nations: China, Japan, South Korea, Australia and New Zealand. Vietnam’s Prime Minister Nguyen Xuan Phuc lauded the hard work of last eight years to produce the “largest free trade agreement of the world”. Japan’s prime minister, Yoshihide Suga, congratulated the nations for “broadening the free and fair economic zone, including a possibility of India’s future return” to RCEP. India had to withdraw from RCEP negotiation under intense internal opposition, but still RCEP remained the largest trading bloc with 2 billion people under its umbrella.

*************************************** RCEP ************************************

U.S. Outlines Negotiating Objectives for Indo-Pacific Economic Framework

The Office of U.S. Trade Representative on September 23, 2022 unveiled negotiating objectives for the 12-nation Indo-Pacific Economic Framework. The U.S. deal with IPEF has been launched in May 2022. IPEF includes Australia, Japan, South Korea, Brunei, Fiji, Indonesia, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam. Collectively, Indo-Pacific Economic Framework controls 40% of global economy. Although many observers see the Indo-Pacific Economic Framework as an alternative to TPP, U.S. doesn't see it that way. 

U.S. to Impose Tariffs on Chinese EVs, Other Imports

Biden administration on May 14, 2024 announced that it would impose tariffs on electric vehicles, solar cells, advanced batteries, steel, aluminum and medical equipment imported from China. As President Joe Biden is facing tremendous headwind in his rematch with Former President Donald Trump, the move is seen to make Biden look tough on China. Chinese Foreign Ministry decried the tariff plan, saying it would vitiate the bilateral trade relationship. 

************* TARIFFS IMPOSED DURING PRESIDENT TRUMP'S SECOND TERM *************

************** TARIFFS ON MEXICO, CANADA, CHINA

Trump to Impose Tariffs on Imports from U.S., Mexico, China

President Donald Trump said on January 31, 2025 that he would impose 25% tariffs on imports from the America's northern and southern neighbors while 10% tariffs on Chinese imports. In placing premiums on the importance of oil, Trump added that he would lower tariffs on oil imports. According to the Energy Information Administration, U.S. imported 4.6 million barrels of oil from Canada and 563,000 barrels from Mexico in October 2024 while pumping nearly 13.5 million barrels in the same month. 

Trump Imposes Tariffs on Imports from Canada, Mexico, China

President Donald Trump upped the ante on February 1, 2025 as he went forward and carried out his threat of imposing 25% tariffs on imports from Canada and Mexico as well as 10% tariffs on imports from China. Mexican President Claudia Sheinbaum said that it would respond in kind by imposing 25% tariffs on the U.S. exports to Mexico. Canadian Prime Minister Justin Trudeau responded Trump's tariffs by addressing to the Canadian people, but telling the southern neighbors that the tariffs would lead to painful outcome for American consumers. The tariffs will go into effect on February 4, 2025. 

President Donald Trump insisted that U.S. should depend on tariffs for enhanced revenue as it was the case before income tax became part of the U.S. Constitution in 1913.  

Trump Brings up Making Canada as U.S.' 51st State

A day after slapping 25% tariffs on non-energy imports from Canada and 10% on oil, natural gas and electricity imports, President Donald Trump on February 2, 2025 lampooned in a Truth Social post that without surplus Canada would become the 51st state of the United States of America. Canada is imposing 25% tariffs on $105 billion in imports from the U.S.

The Dallas Morning News reported in the February 3, 2025, print edition that average American family would spend an additional $1,245 a year due to Trump-proposed Tariffs, based on the research conducted by the Budget Lab at Yale University, amounting to $1.4 trillion equivalent of additional taxes over the next decade. 

30-day Pause to Tariffs on Imports from Mexico and Canada

After hours of hectic talks among the neighbors, saner and cooler heads eventually prevailed and President Donald Trump on February 3, 2025 paused the proposed tariff regimes on imports from Canada and Mexico for 30 days. Similarly, America's northern and southern neighbors put a 30-day pause to their own counter-tariff proposals. The pause came in response to Canada and Mexico agreeing to take some concrete measures to quelch the flow of Fentanyl and undocumented migrants to the U.S.

Canadian Premier Justin Trudeau during the announced that Canada would soon name a Fentanyl czar, list Mexican cartels as terrorist groups and form a "Canada-US Joint Strike Force" to fight against organized crimes, fentanyl and money laundering. 

Ontario's premier Doug Ford, who had separately imposed sanctions, on February 3, 2025 suspended those sanctions, including suspending a $68.12 million contract with Elon Musk's Starlink project to provide high-speed internet services to 15,000 people in rural and remote areas and instructing provincial liquor board to remove all the U.S. liquors from the shelves. 

Mexican government had also put a pause to its own tariff proposal and Mexican President Claudia Sheinbaum decided to send 10,000 troops to the U.S.-Mexico borders. 

President Trump expressed satisfaction after his call with his Mexican counterparts and added that the negotiation with Canadian and Mexican officials would be headed by Secretary of State Marco Rubio, Treasury Secretary Scott Bessent and Commerce Secretary nominee Howard Lutnick. Meanwhile, White House National Economic Council Director Kevin Hassett refused the characterize the ongoing spat over tariffs as trade war. 

Tariffs Set to Begin after 30-day Pause as Fentanyl Continues to Pour in

President Donald Trump on February 27, 2025 said that 25% tariffs would be imposed on imports from Canada and Mexico effective March 4, 2025 after a 30-day pause. Trump added an additional 10% tariffs on Chinese imports in addition to already announced tariffs of 10%, resulting in a total of 20% tariffs on imports from China beginning March 4, 2025. 

Canada, China Retaliate; Mexico Intends to in Coming Days as Trump Tariffs Take Hold

As the clock ticked past 11:59PM on March 3, 2025 into the dawn of March 4, 2025, it was a "new era for sure", according to Dartmouth College Professor Douglas Irwin-- an author of a 2017 renowned book on trade war, Clashing Over Commerce--whose calculation showed that the average overall tariffs would rise from 2.4% to 10.5%, the highest since 1940s. The March 4, 2025 marked a Black Day in the Republic's history related to trade and commerce as the Trump tariffs of 25% on Mexican and Canadian imports went into effect during the day, barring Canadian energy imports for which Trump imposed a 10% tariff. For Chinese imports, the overall tariff doubled from 10% to 20%. 

The U.S. lumber industry is scrambling over this disingenuous tariff as the industry significantly depends on Canadian imports. Similarly, the nation's toy industry will experience bearish sentiment as its future is interwoven with Chinese manufacturers. 

Canadian Prime Minister Justin Trudeau responded on March 4, 2025 that Ottawa would impose tariffs on $100 billion in U.S. exports [to Canada] over the next three weeks. China responded by slapping tariffs of up to 15% on a host of farm imports from the U.S. and expanded the list of firms under export control and other limits. Mexico took a stand of wait and watch until March 9, 2025 when the retaliatory tariffs would be announced barring any compromise. 

**************************** TARIFFS ON AUTOMOTIVE INDUSTRY

Trump Gives Tariff Reprieve to "Big Three" Automakers for a Month

President Donald Trump on March 5, 2025 gave reprieve from 25% tariffs on imports from Canada and Mexico to General Motors, Ford and Stellantis for a month to prepare their supply chain ecosystem and functional pipelines to mitigate and minimize the pain of the presidential action to punish US' two neighbors. 

Trump Imposes 25% Tariff on Car, Parts Imports 

President Donald Trump on March 26, 2025 announced imposition of 25% tariffs on auto imports beginning in July 2025. 

**************************** TARIFFS ON AUTOMOTIVE INDUSTRY

Trump Postpones Tariffs for about a Month

President Donald Trump on March 6, 2025 paused tariffs on Mexican imports and some imports from Canada for about a month, but would begin on April 2, 2025. President Trump said on Truth Social that "I did this accommodation, and out of respect for, President Sheinbaum". 

However, Ontario Premier Doug Ford announced during the day that his government would raise the prices for electricity by 25% effective March 10, 2025, raising the specter of trade war with Trump. 

Tariff War Hits Crescendo, Subsequently Falls back, Still Enough to Roil the Stock Market

That the old adage that the stock market hates uncertainty still holds true. The U.S. stock market has gone into tailspin in the last few days. After Ontario Prime Minister Doug Ford raised the charges of electricity supplied to the U.S., it was a matter of time when Trump would hit back. That escalatory point arrived on March 11, 2025. Trump doubled the tariffs on Steel and Aluminum imports [from Canada] from the originally proposed 25% to 50%. Ontario Premier Doug Ford relented, and suspended the electricity charges announced in recent days. Trump retreated too, leading to an average of 25% tariff on the Steel and Aluminum imports effective March 12, 2025. 

Trump's 25% Tariffs on Metals Roil the Market

President Donald Trump is wrecking the equity market with tariffs. On March 12, 2025, Trump's 25% tariffs on steel and aluminum imports went into effect. Canada's retaliatory tariffs on $9.9 billion in U.S. imports of steel and aluminum products as well as computers and water heaters will go into effect on March 13, 2025. That's in addition to 25% tariffs on $20.8 billion in U.S. imports slapped on March 4, 2025 in response to Trump's own tariffs on Canadian imports, which have been partially delayed for a month. 

Trump's reciprocal tariffs of 25% on European, South Korean and Brazilian imports will begin April 2, 2025. European Union will slap counter-tariffs on 26 billion euros, or $28 billion, in imports from the U.S. beginning April 1, 2025. 

Trump Threatens to Slap 200% Tariffs on Wines, Champagne 

After 25% tariffs on metal imports went into effect on March 12, 2025, European Union rolled out a list of U.S. imports valued at 26 billion euros to be targeted for counter-tariffs, and many of the items included U.S. wine and alcohol categories. That enraged none other than Donald Trump, who took to Truth Social on March 13, 2025 to threaten 200% tariffs on wines and champagnes from France and other EU nations. 

Trump in his second term is following a sector-by-sector tariff approach and rolling out them in phases. A regime of reciprocal taxes is going to be imposed on European imports on April 2, 2025. 

************** TARIFFS ON MEXICO, CANADA, CHINA

**********TRUMP'S "RECIPROCAL" TARIFFS HITTING VARIOUS NATIONS **********

Trump Unveils Expansive Tariffs on Imports from Nations around the World

Displaying a chart and lambasting the U.S. trade policies of previous administrations, President Donald Trump on April 2, 2025 announced a 10% baseline tariff and a varying ladder of cumulative tariffs for individual nations. For the U.K., it was the baseline tariff of 10% imposed. Imports from China, European Union, India, Japan and South Korea will be subject to 34%, 20%, 26%, 24%, and 25%, respectively. 

During a Rose Garden event during the day, dubbed the "Liberation Day of America", joined by hardhat-worn workers, President Donald Trump railed against allies and adversaries, name-calling that the U.S. got plundered, pillaged, looted because of the unjust trade policies, thus necessitating the "reciprocal" tariff regime. 

Market Meltdown in Response to Trump Tariff Erases $2 trillion in Wealth

It was a equity market free fall a day after the so called "Liberation Day" as President Donald Trump declared on April 2, 2025 while slapping nations across the world with varying degrees of "reciprocal" tariffs. On April 3, 2025, markets all around the world nose-dived as investors realized that Trump's action had been worse than their worst expectation. The DOW Jones Industrial Average plunged 4% on April 3, 2025, while NASDAQ Composite Index and S&P 500 Index dropped by 6% and 4.8%, respectively. The S&P 500 Index is down 11.8% as of April 3, 2025 compared to its highest level in February 2025. As a result of the market bloodbath, an approximately $2 trillion in U.S. equity wealth was obliterated on April 3, 2025. 

Markets Tumble Further after China Hits back with Matching Tariff

After China matched President Donald Trump's 34% tariff on the Chinese imports with the same scale of its own punitive tariffs on the U.S. imports, it was clear that the global economy would get worse before it got better. On April 4, 2025, S&P 500 Index fell 6%, NASDAQ Composite Index shed 5.8%, going through the psychological drop of more than 20% compared with its recent high, and DOW Jones Industrial Average dropped 2,231 points, or 5.5%. In addition to imposing 34% tariffs on the U.S. imports, China on April 4, 2025 announced export-control measures for rare-earth minerals for the U.S. companies.

Stocks Wildly Swing on Rumor, Trump Threat to Up the Ante on China

After China hit back last week with its own 34% tariffs on the imports from the U.S., President Donald Trump prosecuted his case on the Truth Social with a threat to slap China with an additional 50% tariffs. If the April 7, 2025, threat of President Donald Trump to slap 50% additional tariffs on imports of Chinese goods goes into effect on April 9, 2025 pending no reversal by April 8, 2025 of Beijing's 34% tariffs, the cumulative tariffs on Chinese imports will mount to a whopping 104%--an initial decision of 20% tariffs as a penalty for Beijing not doing enough to prevent the fentanyl flow into the U.S., followed by the "Liberation Day" (April 2, 2025) tariffs of 34%, and now additional 50% tariffs. 

Trump had single-handedly swooned the equity markets into turmoil. Federal Reserve Chairman Jerome Powell said on April 4, 2025 that tariffs would only make any decision on interest rates uncertain. Nation's one of the most prominent bankers, Jamie Dimon, CEO of the JP Morgan, hinted on April 7, 2025 in a letter to shareholders a higher probability of recession while putting pressure on prices, broadly indicating a vicious and treacherous period of "stagflation". 

Stock markets started the day (April 7, 2025) surging with a raging rumor attributed to a key White House economic adviser, Kevin Hassett, that Trump administration was considering to pause upcoming tariffs on imports from all nations barring China. Once the White House punted the rumor and Trump's Truth Social posts appeared, markets reversed and stocks started to free-fall. At close, DOW Jones Industrial Average lost 0.9%, S&P 500 dropped by 0.2% and NASDAQ Composite Index dropped by 0.1%. 

China to "Fight to the End" against Trump's Threat to Slap An Additional 50% Tariff

As the total trade between the two largest economies rise to $582 billion in 2024, with a U.S. trade deficit running in the range between $263 billion and $295 billion, China's Commerce Ministry is giving a short shrift to Trump's "bullying". In a statement issued on April 8, 2025, Chinese Commerce Ministry vowed to retaliate and "fight to the end" against Trump's "bullying practice". 

Trump Pauses Tariffs for Most Nations, Hits China Further, Global Markets Soar, China Ups Tariffs too

That the market volatility, under President Trump's second term in White House, is the reflection of emotional reaction to tweets, or social media postings, of the president and other officials, instead of underlying market strength or weakness, is proving itself repeatedly, with global equity and bond markets swinging to-and-fro like pendulum on daily, nay hourly, basis. 

Hours after the reciprocal tariffs went into effect in the early hours of April 9, 2025, President Donald Trump, showing a dainty sensitiveness to the surging bond yields which he described as positive, but most economists thought otherwise, acknowledged that people might be feeling little "yippy". On Truth Social posting, he paused the reciprocal tariffs--not the baseline tariff of 10%--for 90 days for most nations 14 hours after they went into effect in the early hours of April 9, 2025. That acted like a stock market catalyst. The U.S. Stock indexes surged higher after the [pause] announcement. DOW Jones Industrial Average ended the day 8%, S&P 500 Index rallied 9.5%, its best upward swing since 2008, and NASDAQ Composite Index jumped 12%. Global markets have either rallied, or are poised to rally, too. In a notable exception, Trump increased the tariffs on Chinese imports from 104%, which had gone into effect at midnight on April 9, 2025, to 125% later in the day. President Donald Trump also left the baseline tariff of 10% for all the imports as well as 25% tariffs on auto, steel and aluminum imports intact. 

On April 9, 2025, China increased tariffs from the U.S. by an additional 50%, elevating the cumulative tariffs on imports from the U.S. to 84%. The Chinese Ministry of Commerce issued a White Paper on the current trade tension on April 9, 2025 in which it brought detailed allegation against the U.S. trade practices and reiterated to fight "to the end" against the U.S. trade bullying. The White Paper said that the escalation would lead to price rises for the American consumers, stall the flow of commerce and trade between the world's two largest economies and swoon the global markets. In addition to levying a cumulative tariff of 84% (34% on April 4, 2025 and 50% on April 9, 2025) on the U.S. imports, China announced a slew of other measures during the day, including a measure to include 11 additional U.S. firms to the list of "unreliable entities" and filing an additional complaint to the World Trade Organization. The WTO chief, Ngozi Okonjo-Iweala, meanwhile expressed alarm over rising trade tension between the U.S. and China, adding that it might lead to negative outlook for the entire global economy and called for a negotiated compromise. 

Trump Ups Chinese Tariffs to 145%

As the world is seeing the jigsaw battle on tariffs between the two largest economies, Donald Trump on April 10, 2025 further increased tariffs on Chinese imports to 145%. 

**********TRUMP'S "RECIPROCAL" TARIFFS HITTING VARIOUS NATIONS **********

************* TARIFFS IMPOSED DURING PRESIDENT TRUMP'S SECOND TERM *************