NEW TARIFFS NOW: Trump will announce he is imposing 25 percent duties on all steel and aluminum imports today, including on countries that negotiated tariff exemptions such as Mexico and Canada. “Any steel coming into the United States is going to have a 25 percent tariff — aluminum too,” Trump said on Air Force One on Sunday as he traveled to New Orleans for the Super Bowl. Reminder: The U.S. maintains 25 percent tariffs on steel and 10 percent tariffs on aluminum for many countries, which the first Trump administration imposed in 2018 under Section 232 of the 1962 Trade Expansion Act. Several trading partners negotiated to modify the duties. Your host has more on that here. WHO WILL BE HIT: Also on Air Force One, Trump reiterated his plan for “reciprocal” tariffs, which he said could come as soon as Tuesday or Wednesday. Trump told reporters, if countries are “charging us 130 percent and we're charging them nothing. It's not going to stay that way,” Trump said. “Every country will be reciprocal.” While the president has yet to clarify how exactly those duties would be imposed, reciprocal means that the U.S. would impose equal tariffs on imports from countries that have higher tariffs on U.S. goods. Morning Trade has your rundown on who could be hit the hardest. Background: Under the World Trade Organization system, tariff rates for a particular product, like cars, can vary widely from one country to the next. However, whatever tariff rate a country has in place for a particular product generally applies to all other countries under what is known as “most favored nation” treatment. In other words, the U.S.’ 2.5 percent tariff on passenger cars is the same for all other countries, unless they have a free trade agreement with the United States. Similarly, the EU’s 10 percent tariff on cars applies to all other countries, unless they have a free trade agreement with the EU. European Union The European Union applies a 10 percent tariff on cars, and also imposes tariffs on some agricultural products, such as beef and pork, as well as chemical imports. Reminder: As of now, the U.S. imposes tariffs of 2.5 percent on passenger vehicles and 25 percent on light trucks/SUVs. European Parliament member Bernd Lange told the Financial Times in a recent interview that the bloc is considering lowering its 10 percent import duty closer to the 2.5 percent charged by the U.S., as it looks to stave off a costly trade war and find ways to cut its surplus with Washington. India Meanwhile, India’s average tariff rate is much higher than that of the U.S., averaging around 10.66 percent compared to the U.S.'s average rate of between two to three percent. India imposes stiff tariffs on motorcycles and certain agricultural and technology products, including those from the United States. It also has a hefty 150 percent tariff on certain alcoholic beverages. The U.S. comparatively has minor tariffs on products that India exports. Something to watch: Trump and Indian Prime Minister Narendra Modi could get a chance to hammer out disputes during a meeting scheduled for Wednesday in their first meeting since Trump returned to the White House for a second term. Brazil Brazil imposes relatively high tariffs on a wide range of U.S. imports, with an average rate of around 12 percent, as of 2022, according to data from Trading Economics. The country also has high tariffs on key agricultural products: 18 percent on cheese and 14.4 percent on butter. As well as an 18 percent tariff on ethanol imports from the United States. Brazil, like many other countries, faces an additional 25 percent duty on its steel exports to the United States because of tariffs that Trump imposed in 2018.
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