Trump Announces New Tariffs on 69 Countries

Trump Announces New Tariffs on 69 Countries

Why in News? 

Recently, former US President Donald Trump announced fresh tariffs on 69 countries, calling it a bold move to fix trade imbalances and protect national interests. The decision sparked global concern as many nations brace for economic impact. 

Trump Announces New Tariffs on 69 Countries

• Implementation Timeline: The new tariff regime announced by former U.S. President Donald Trump is scheduled to take effect from August 7, 2025. The executive order, signed on July 31, allows a short window for further negotiations and policy harmonisation. 

• Tariff Structure: The tariffs introduced range widely—from 10% to as high as 50%—depending on the nature of trade relations and ongoing disputes. Nations that failed to reach last-minute understandings are subject to higher penalties, while others secured more favourable adjustments. Many nations will face a default rate of 10%.

• List of Affected Countries: A total of 69 countries, along with the 27-member European Union, are included in this extensive trade revision. These countries span Asia, Africa, Latin America, and Europe. Here’s a list of some major impacted countries:

• • • India: 25% tariff due to unresolved trade issues.
    • Brazil: 50% tariff, with a few exemptions on key exports.
    • Syria: Faces the highest rate at 41%.
    • Switzerland: Faces a 39% tariff.
    • Laos and Myanmar: Both the countries will face a 40% tariff.
    • Canada: Tariff raised to 35% from 25% citing fentanyl-related concerns.
    • South Korea: Secured a 15% rate through negotiation.
    • Mexico: Granted a 90-day delay on additional tariffs.
    • Taiwan: Faces a 20% tariff with ongoing negotiations.
    • The European Union: Goods already subject to tariffs above 15% will be exempt from additional levies, while others will be adjusted accordingly.
    • Vietnam, Sri Lanka, Bangladesh, Indonesia, Pakistan: Rates range from 19% to 25%.

• Affected Sectors: The new tariffs are set to impact a wide array of industries:

• • Agriculture: India was specifically targeted for its protectionist measures in this sector.
  • Automobile and Electronics: Especially in nations like Mexico and Taiwan.
  • Raw Materials: Brazil faces 50% tariffs on metals such as copper, aluminium, and steel.
  • Pharmaceuticals and Chemicals: Canada penalised in relation to fentanyl-related imports.
  • Textiles and Consumer Goods: Nations like Vietnam, Sri Lanka, and Bangladesh are likely to see cost pressures in these sectors.

Also Read: America Imposes 25% Tariff on India

Why were the Tariffs Imposed?

• To Fix Trade Imbalances: Donald Trump has long believed that the United States is losing in global trade. America buys more than it sells to many countries. This gap is called a trade deficit. According to the US, these trade deals are unfair. He wants other countries to treat the U.S. the same way the U.S. treats them. If America charges low tariffs on imports, he thinks other countries should do the same. 

• To Protect National Security: Some imports into the country come from regions or sectors that are linked to national security. For example, when critical materials like steel or electronics are controlled by foreign players, it can leave the nation vulnerable during crises. Overdependence on imports can pose risks if those supply chains are disrupted. These tariffs aim to reduce that risk. 

• To Encourage Fair Negotiations: Many countries benefited from old trade rules that no longer reflect today’s economic realities. While some of them became wealthier, they still enjoy special trade privileges. In some cases, those rules protect industries that no longer need support. These tariffs serve as a tool—not as a punishment, but as a strong signal. If countries are willing to talk and make changes, adjustments can follow.

• To Strengthen the Domestic Economy: When American factories shut down and jobs move overseas, families and communities suffer. The goal of the tariff policy is to bring some of that lost work back. By making imported goods more expensive, the hope is to boost demand for locally made products. That means more factories, more production, and more employment inside the country. It’s about rebuilding what was lost over decades. 

Also Read: What is Reciprocal Tariff?

Global Impact of This Tariff Decision

• Higher Trade Costs: As the new tariffs come into force, the cost of exporting goods to America will increase for many countries. This means companies in Asia, Africa, and Europe may have to raise prices to stay profitable. A report from the World Trade Organization (WTO) warns that high tariffs can reduce global trade growth by up to 1.3% in the next quarter. Small exporters and manufacturers will be hit the hardest. 

• Developing Economies Setbacks: Countries like Vietnam, Bangladesh, and Myanmar, which rely heavily on exports, are facing tariffs between 19% and 40%. These nations often depend on U.S. trade to support jobs and economic growth. For nations already battling inflation and currency problems, this is a big blow. Fewer export orders mean fewer jobs and more poverty. 

• Tensions Between Allies: Several close allies of the U.S.—including Canada, South Korea, and the European Union—were surprised by the sudden tariff hikes. Even though some reached partial deals, trust has been shaken. Canada’s 35% tariff increase, for example, was linked to disputes over drug control, not trade alone. Such tensions can affect military, climate, and tech partnerships .
• Global Market Instability: After the tariff news broke, several global stock indexes saw immediate reaction. The MSCI World Index, which tracks stock performance across 23 countries, dropped in a single day. Currency markets also responded, with the Indian rupee and Brazilian real falling slightly due to fears of reduced exports. This volatility adds uncertainty for businesses planning long-term investments.