President Donald Trump is preparing to unveil the next tool in his trade policy arsenal: reciprocal tariffs.
Speaking to reporters at the Oval Office on Feb. 10, the president highlighted the importance of reciprocal tariffs. If America’s trading partners are charging the United States higher tariffs, the current administration would adopt the same rate.
“You'll be hearing that word a lot: reciprocal,” Trump said. “If they charge us, we charge them. If they’re at 25, we’re at 25. If they’re at 10, we’re at 10. And if they’re much higher than 25, that’s what we are too.”
Trump stressed the importance of having a level playing field in global trade. “We want tariffs to be fair,” he told reporters.
Senior White House officials have espoused similar views on trade.
Last month, Commerce Secretary Howard Lutnick told lawmakers that tariffs could be an effective negotiating strategy to restore respect for the United States on the world stage.
“I think Chinese tariffs should be the highest, our adversaries should be the highest,” Lutnick said. “But the fact that we Americans cannot sell an American car in Europe is just wrong, and it needs to be fixed.
“They are taking advantage of us, they are disrespecting us, and I would like to see that end.”
“For too long, our nation has allowed unfair distortions in the international trading system,” Bessent stated.
The European Union, for example, maintains a 10 percent tariff on U.S. car imports. Conversely, the U.S. government has a 2.5 percent tariff on European automobiles.
However, the United States has higher tariff rates for European products in other circumstances.
Steel and Aluminum Tariffs for All
Trump’s remarks come after he signed trade proclamations on Feb. 10 reinstating 25 percent tariffs on all steel and aluminum imports that will take effect March 4.While the levies will impact all steel exporters, the most affected countries will be Canada (6 million tons), Brazil (4.1 million), Mexico (3.2 million), South Korea (2.5 million), Vietnam (1.2 million), and Japan (1.1 million).
A chorus of economists says that this endeavor will benefit the United States. Trump also believes many U.S. businesses will be opening because of these tariffs.
“The cost increases in steel and aluminum will quite likely cause buyers to seek alternative, cheaper sources, and the only country where steel and aluminum will be 25 percent cheaper is—you guessed it—America,” said Mark Malek, the CIO of Siebert Financial, in a note emailed to The Epoch Times.
“This is likely to bring demand back to local producers.”
The American Iron and Steel Institute (AISI) confirmed to The Epoch Times that older, less-efficient mills have started running at less than full production. The group estimates the steel capacity utilization rate was 74.4 percent for the week ending Feb. 1.
Kevin Dempsey, president and CEO of AISI, said the president’s trade agenda will remedy “foreign market-distorting policies and practices that create an unlevel playing field for American steelmakers.”
“AISI welcomes President Trump’s continued commitment to a strong American steel industry, which is essential to America’s national security and economic prosperity,” Dempsey said in a statement to The Epoch Times.
Trump, meanwhile, noted that the latest set of tariffs does not include exemptions or exclusions. However, he is giving “great consideration” to exempting Australia because the United States has a roughly $18 billion trade surplus with Australia.
How this will affect the current trade relationship with Canada and Mexico remains to be seen.
Last week, Trump agreed to a 30-day pause on 25 percent tariffs on Canadian and Mexican imports after the two countries agreed to implement the necessary border policies to fight illegal immigration and the drug trade.
Canadian Prime Minister Justin Trudeau agreed to appoint a fentanyl czar, invest $200 million in intelligence gathering relating to organized crime, and establish a joint U.S.-Canada strike force to fight organized crime.
In Mexico, President Claudia Sheinbaum pledged to send 10,000 troops to the border in exchange for limiting the number of U.S. guns entering the country.
When Fox News’s Bret Baier asked Trump if their actions warrant ending his tariff threat, the president said more needs to be done.
