The Art of the Tariff: An Overview of Trump's 'Tariff Hit List'

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Reciprocal tariffs, a vital pillar underpinning the incumbent administration’s economic agenda, have recently reignited in the face of an August 1st deadline. Under the International Emergency Economic Powers Act of 1977, the President has sought reciprocal tariffs against 69 trading partners under the political disguise of an “unusual and extraordinary threat to the national security of the United States”. The enactment is expected to raise the effective tariff rate on US imports to its highest level since 1934.  

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Amongst the list of notable names inscribed in the President’s ‘tariff hit list’ lies Taiwan, a country which stands to face a 20 per cent tariff rate on the majority of its exports, with sectoral tariffs on semiconductors and other electronics still subject to impending negotiations. Taiwan’s President, Lai Ching-te, later described the act during a press briefing as “temporary”, and expressed his ambitions to “continue negations and strive for a rate that’s more favourable for Taiwan”. Last year, Taiwan held the 6th largest trade deficit with the United States, exporting approximately $74 billion more than they imported. 

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Swiss policymakers were left in shock after their nation unexpectedly awoke to a 39 per cent tariff rate, a rate remarkably higher than those imposed upon their European counterparts, on the grounds of accumulating one of the largest imbalanced trade surpluses in the world with the United States. In 2024, Switzerland exported roughly $60.9 billion worth of goods into the United States. The Swiss government openly lamented the move to be of “great regret”, despite their seemingly productive efforts in attempting to conceive an equitable framework trade deal.  

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India is expected to bear a 25 per cent tariff rate, in tandem with a presently undecided penalty for its role in the purchasing of Russian oil and weapons amidst the Ukraine-Russian war, according to a Truth Social post by the President. Although the newly imposed tariff rate marks a marginal reduction from the 27% tariff rate initially proposed in April, many analysts are now expecting the tariff to weigh in on India’s rate of GDP growth, particularly in light of their regional developing counterparts facing lower tariff rates. Nomura, a global investment bank, predicts the tariffs to reduce India’s GDP by 0.2%.  

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The UK and the EU have managed to remain comparatively unscathed given their respective successes in reaching a framework trade deal prior to the deadline; the former has been struck with a 10 per cent tariff, whilst the latter is set to a face 15 per cent tariff. In contrast, Brazil has been subjected a 50% tariff rate, with sectoral exemptions placed on aircraft and energy.

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The President’s re-establishment of the global economic order is beginning to take shape. Will the use of politically obstructive means to achieve economically sound outcomes harm global growth?