Trump’s Sweeping Tariffs Take Effect, Reshaping Global Trade Landscape

US President Donald Trump’s extensive new tariffs on over 90 countries have officially come into effect today, August 7th, following the expiration of his deadline for nations to negotiate new trade deals. Moments before the cut-off, Trump announced on Truth Social that billions of dollars were now flowing into the US as a direct result of these import taxes, which he aims to leverage for boosting American jobs and manufacturing.

This significant policy shift marks the highest average US tariff rate in nearly a century. While the duties were initially announced in April, many were paused amidst market turbulence to allow for negotiations. Today’s implementation follows a final negotiating deadline of August 7th, with varying rates set for different countries.

Export-dependent economies in Southeast Asia are among the hardest hit, with Laos and Myanmar facing levies as high as 40%. Switzerland also faces a steep 39% tariff, prompting an extraordinary meeting from its officials after failing to secure a deal with the US. Taiwan, a key US ally, has been subjected to a 20% tariff, though its president indicates ongoing discussions for a temporary rate.

Despite months of uncertainty, Asian markets generally absorbed the news on Thursday, with major indices in Japan, Hong Kong, South Korea, and mainland China showing slight gains, while India and Australia saw declines. Some major economies, including the UK, Japan, South Korea, and the European Union, have successfully secured agreements or framework deals to mitigate the impact of the tariffs.

In related developments, Trump recently boosted tariffs on Canada and paused higher duties on Mexico amid ongoing negotiations. Discussions continue with China regarding a potential extension to a 90-day tariff pause expiring on August 12th. Furthermore, Trump has threatened a 50% tariff on Indian goods from August 27th if the country continues purchasing Russian oil, and announced a 100% tariff on foreign-made semiconductors, though major US-invested chipmakers are expected to be exempt.

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