On Wednesday, President Trump announced import tariffs against much of the rest of the world, sending global markets into chaos. Chris Featherstone writes that Trump’s tariffs announcement shows his singular and transactional focus on US trade deficits with other countries. So far, countries have responded with either conciliation or confrontation, and while both responses may have some success, the dust is not likely to settle on the effects of Trump’s tariffs for some time.

President Donald Trump’s announcement of “reciprocal” tariffs on 185 trade partners this week has had a seismic impact on the global economy. Trump has signalled the increased tariffs for months and has tested his approach against Mexico and Canada. This latest round of tariffs is the most extensive yet and are the epitome of his transactional and zero-sum approach to international trade and politics.

This tariff announcement, on what Trump declared as the US’ “Liberation Day”, had been signalled throughout the 2024 Presidential election campaign and the early weeks of the Trump administration. Yet their sheer extent still came as a shock, as did the emotive framing Trump gave to his case for these tariffs. His claim that these trade partners had “looted, pillaged, raped, plundered” the US set the tone for this shocking announcement.

These tariffs place a 10 percent import tariff on products from most partners, with some facing far higher tariffs such as China (34 percent), the EU (20 percent), and Vietnam (46 percent). With these tariffs, Trump is seeking to encourage US consumers to buy American, whilst also raising more revenue from imports. The White House confirmed this, stating that “Large and persistent annual US goods trade deficits have led to the hollowing out of our manufacturing base”. Whilst the US may have a goods trade deficit with many partners, this deficit is made up with the services that the US provides globally.

These tariffs show Trump’s transactional approach to international trade. In his understanding, if the US has a goods trade deficit, to Trump this represents partners taking advantage of the US. Yet the picture is far more complex than this. Trump’s image of trade focuses singularly on goods, to the exclusion of services and to the US’ unique position in the global economy.

Tariff response 

Understandably, given the unprecedented nature of Trump’s “liberation day” announcement, US trade partners are still scrambling to develop their response. Beyond the expected shocked reactions, the responses have fallen into two types. Firstly, there are those who have sought a conciliatory approach, looking to avoid antagonising the infamously sensitive Donald Trump. Secondly, and in contrast, there are those who have taken a more confrontational approach, emphasising the unacceptability of these tariffs.

Conciliation 

For some of those taking the “conciliatory” approach to these Trumpian trade tactics, they have seen the effectiveness of their approach. The UK, for example, has been slapped with the “baseline” tariff of 10 percent, despite fears that it would be 20 percent. Reportedly, the UK government had picked up signals that they were “in the good camp rather than the bad camp”, and whilst the tariffs will impact the UK economy significantly, UK ministers appear relieved at the lighter rate than that imposed on the EU.

The Polish President Donald Tusk’s response to Trump’s announcement also indicated a conciliatory approach. Acknowledging the pain of the tariffs, and the pain that came from them being imposed by Poland’s closest ally, Tusk also highlighted that the Polish-American “friendship” must “survive this test”. For both the UK and Poland, this conciliatory approach carries significant risk. For both nations, an appearance of acceptance of these tariffs by not reciprocating could encourage further tariff announcements from the White House. For the UK, their approach also places enormous pressure on their trade talks, but by not reciprocating with tariffs, UK negotiators are entering talks with fewer potential offers to their US counterparts. If the UK responded with initial reciprocal tariffs, UK negotiators would have a strong opening offer for their Trump team counterparts.

“Liberation Day, President Trump at the Make America Wealthy Again Event – April 2, 2025” by The White House is United States government work.

Confrontation 

The confrontational response to Trump’s tariff announcement at first glance appears the most Trump-esque approach. French President Macron’s response to Trump’s announcement is a stark example of this. He accepted the emotive framing Trump placed on these tariffs, pushing back hard by framing Trump’s announcement as “brutal” and “unjustified”. He went further, calling for investment in the US from the EU to be frozen until the economy stabilises. The French government is reportedly a strong proponent of a two-step approach to reciprocal tariffs, with a large increase in their severity.

Canada’s new Prime Minister Mark Carney has also adopted a similarly confrontational response. This is understandable given the extreme economic impact of US tariffs on Canada. Carney can also ride a groundswell of Canadian popular opposition to the US and US tariffs, reducing domestic opposition. Carney has managed this support well, appealing to voters’ patriotism, “Americans should make no mistake, in trade, as in hockey, Canada will win”. Speaking to the media, Trump himself has indicated the effectiveness of this tough Canadian response, describing a phone call with Carney as “extremely productive”.

The dust is still settling on tariffs and their effects on the global economy

Both responses have been framed to have had some success, and yet the outcome remains unclear. With the dust still settling after Trump’s announcement sent the global economy into chaos, all responses may yet change significantly. And yet, lessons are likely being learned from this experience. Dealing with Trump has been notoriously difficult. Any indication of a successful approach will likely be the focus of significant attention. However, each approach has the potential to prolong economic instability, given Trump’s sensitivity towards perceived disrespect to himself personally or the US.

This tariff announcement has once again highlighted the difficulties in dealing with Trump. This difficulty stems in part from Trump’s combative and confrontational style. It also comes from the Trump team’s limited reliance on facts and data when making these decisions. The characterisation of US trade deficits and surpluses are a stark example of this, demonstrating a highly selective approach to data and downright rejection of evidence contradicting Trump’s innate understanding of international trade relationships. US allies and opponents alike are scrambling to respond, and we are yet to see the full extent of the fallout from Trump’s tariff announcements.

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• Note: This article gives the views of the author, and not the position of USAPP – American Politics and Policy, nor the London School of Economics.