On April 2, 2025, U.S. President Donald Trump unveiled a broad new tariff regime, a sharp escalation of his administration’s protectionist trade policies. Referred to by Trump as “Liberation Day,” the proclamation contained a base tariff of 10% on all imports into the U.S., effective April 5, as well as much greater “reciprocal tariffs” targeting specific countries, effective April 9.
These policies, enacted under the International Emergency Economic Powers Act (IEEPA) through a national emergency proclaimed because of persistent trade deficits, aim to move global trade back in the direction of U.S. manufacturing. However, the move has raised widespread alarm, with the threat of economic repercussions looming large over both the U.S. and its global partners. This piece examines the countries most affected by these tariffs and the initial reactions from around the world as of April 3, 2025.
The Tariff Framework
The new policy imposes a blanket 10% tariff on all imports to the U.S., with only an exemption for Canada and Mexico under a temporary exemption tied to the U.S.-Mexico-Canada Agreement (USMCA). However, these two nations still have the prior 25% tariffs that were imposed in February of 2025 for the intent of curtailing migration and fentanyl smuggling. Besides the baseline, Trump levied deeper reciprocal tariffs on dozens of countries, based on their trade surpluses with the U.S. and estimated non-tariff barriers. Notable rates are a 54% tariff on China (over and above existing duties), 20% on the European Union (EU), 26% on India, 24% on Japan, 46% on Vietnam, and 32% on Taiwan. Additionally, a 25% tax on all foreign-made automobiles went into effect at midnight on April 3 and added to the trade overhaul.
Countries Most Affected
China
As the U.S.’s largest trading partner, China is hit the hardest with an effective 54% tax on exports. Imports to the U.S. from China were more than $450 billion in 2024, including electronics, machinery, and consumer goods like smartphones and toys. The new tariffs build on previous duties from Trump’s first term, targeting Beijing for its role in fentanyl precursor supply chains and trade imbalances. China’s economy, though less trade-dependent than two decades ago (exports and imports now account for 37% of GDP), will still feel significant pressure, particularly in tech-heavy sectors.
European Union
The EU, which enjoyed a $213 billion trade surplus with America in 2024, is hit with a 20% tariff. The hardest hit would be Germany, as a manufacturing center, with its car titans—Volkswagen, BMW, and Mercedes—paying more due to the car tariff. Ireland’s medical device and pharma exports and France’s wine and luxury goods are also vulnerable. The EU exported over $500 billion worth of goods to the U.S. last year and thus presents a prime target for Trump’s reciprocal trade policy.
Canada and Mexico
While staying clear of the latest reciprocal tariffs, Canada and Mexico remain under the 25% levies imposed in February, with the energy exports from Canada facing a reduced 10% rate. Canada, the second-largest trade partner of the U.S., sent $97 billion in oil and gas and significant auto parts in 2024, while Mexico, the largest exporter, sent $46 billion in farm products (e.g., avocados, vegetables) and $200 billion of industrial products. These tariffs threaten North America’s integrated supply chains, particularly in the auto sector.
India
India will be charged a 26% tariff, matching its $70 billion trade surplus with the United States. Most of its top exports, including pharmaceuticals, textiles, and IT hardware, will cost more. While India’s economy is less export-oriented than some of its counterparts, the tariffs can disrupt its budding role as an alternative manufacturing site to China.
Japan, Vietnam, and Taiwan
Japan (24% tariff) exports automobiles and electronics worth over $130 billion annually to the U.S., whereas Taiwan (32%) and Vietnam (46%)—growing manufacturing hubs—suffer from high tariffs on textiles, footwear, and semiconductors, respectively. Taiwan’s TSMC, a prominent chip manufacturer, was exempted after a $100 billion U.S. investment deal, but smaller firms are left exposed.
Global Reactions as of April 3, 2025
The international response has been swift, ranging from anger to threats of retaliation, as countries struggle to stem the fallout from Trump’s tariffs which could lead to a trade war.
China
China condemned the tariffs as “unilateral and protectionist,” and vowed to take “all necessary measures” to protect its interests. Beijing slapped 10-15% tariffs on US farm goods on March 10 as a reprisal against earlier duties, and analysts expect further counterattacks in the coming days in the form of currency devaluation or export curbs on rare earth minerals.
European Union
EU leaders responded with dismay, with Polish Prime Minister Donald Tusk calling it a “stupid tariff war” to be avoided at all costs. The European Commission called the policy a “step in the wrong direction,” outlining a two-stage plan for retaliation. French President Emmanuel Macron, after a February meeting with Trump, had urged focus on China instead, but the 20% tariff has flared up tensions once more. Germany’s interim Economy Minister Robert Habeck said a solid European united front might be enough to prompt Trump to reconsider.
Canada
Prime Minister Mark Carney (who took Justin Trudeau’s place in late March) promised to “relentlessly fight” the tariffs, announcing 25% counter-tariffs on $155 billion of American products, starting with $30 billion immediately. Ontario Premier Doug Ford escalated the reaction, banning U.S. liquor, scrapping a Starlink agreement, and threatening a 25% fee on electricity sales to U.S. states.
Mexico
President Claudia Sheinbaum threatened retaliation but gave no details, with a more detailed response due by April 6. Tariffs on U.S. farm exports such as soybeans and corn are expected by analysts, taking advantage of Mexico’s bargaining power in food chains.
India
India’s Department of Commerce is “closely scrutinizing” the tariffs, looking for opportunities in the disruption. No immediate retaliation was promised, but India can retaliate by targeting U.S. exports such as almonds and information technology services.
Japan
Japan has been treading carefully in its reaction, with officials only criticizing auto tariffs and not making threats. Tokyo will likely opt for talks since it has close ties with America.
South Korea
Acting President Han Duck-soo condemned the 25% tariff on export goods a “grave” crisis, summoning an emergency taskforce. South Korea, targeted by duties from the car tariff, threatened an “all-out” reaction, with possible targets being U.S. imports of energy.
Australia
Australian Prime Minister Anthony Albanese condemned the 10% baseline tariff as ridiculous, arguing that it sabotages the U.S.-Australia relationship. No retaliation was evidenced, but diversification of commerce is under study.
Brazil
With unusual bipartisan agreement, the Congress of Brazil passed a reciprocity bill to permit swift retaliatory tariffs on American goods should they be called for, meaning anticipation of tit-for-tat tit-and-yaw back-and-forth.
Trump tariffs have unleashed a torrent of uncertainty, with global markets plummeting on April 3, Asian stocks took the tumble, and economists warning about inflation and supply-chain chaos. The American consumer will bear the brunt, with estimates of a $1,000-$4,000 increase yearly per household, contingent upon retaliation. For countries targeted, the game is high-risk: Canada and Mexico risk recessions, China risks a tech showdown, and the EU risks losing industry.
