On April 2nd, President Donald Trump announced a 25% tariff on South Korea and reciprocal tariffs for all countries. However, items that were previously subject to other tariffs, such as steel, aluminium, and automobiles, will not face additional reciprocal tariffs. In addition, Canada and Mexico, which have a trade agreement under the United States-Mexico-Canada Agreement (USMCA), will continue to receive tariff-free status for items covered by the agreement. The White House issued a press release detailing these points.
The White House also identified several items that will not be subject to reciprocal tariffs, in addition to steel and automobiles. These include copper, pharmaceuticals, semiconductors, wood, gold bars, energy, and certain minerals not available in the United States. Pharmaceuticals, semiconductors, and wood are items that President Trump had previously announced tariffs on. The United States has been imposing a 25% tariff on steel and aluminum since March 12th, and a 25% tariff on automobiles is scheduled to take effect starting April 3rd.
Furthermore, the White House clarified that tariffs would remain waived for items covered by the USMCA for both Canada and Mexico. However, a 25% tariff will be applied to items not included in the trade agreement, with energy products facing a 10% tariff. Earlier this year, President Trump declared a state of emergency at the southern and northern borders in response to illegal immigration and fentanyl issues, and he issued an order imposing a 25% tariff on both Mexico and Canada in early February. This order was suspended for a month, and in early March, Trump announced that the 25% tariff would only apply to items not covered by the USMCA.
The White House also stated that if the existing executive order expires, products not covered by the USMCA would face a 12% reciprocal tariff. However, products under the USMCA would continue to enjoy preferential treatment. Regarding the timeline for the reciprocal tariffs, the White House stated that they would remain in place until the trade deficit and the threat of non-reciprocal treatment were resolved or mitigated. In terms of retaliatory actions from other countries, the White House warned that tariffs could be raised if a trading partner retaliates but could also be reduced if a trading partner takes significant steps to address non-reciprocal trade agreements and align with the United States on economic and security issues.