US President Donald Trump announced a broad package of new tariffs on Wednesday, escalating tensions with allies and adversaries alike in a bid to bolster US manufacturing. The announcement, which Trump branded as “Liberation Day,” aims to counter what he calls years of unfair trade practices. However, economists warn the move could spark a global trade war and weaken the economy.
He is once again upending global trade with a sweeping tariff plan aimed at rewriting the economic order. His administration’s latest move—dubbed “reciprocal tariffs”—seeks to impose levies mirroring those placed on American goods by foreign countries. While the White House frames the policy as a push for fairness, critics warn it could escalate into a full-scale trade war.
Speaking of impact, US companies that import goods will have to pay the new taxes, especially if the White House starts charging them “right away,” spokesperson Karoline Leavitt had suggested on Tuesday. According to a BBC report, higher the taxes, more companies will try to find ways to reduce those costs. They might change suppliers, ask business partners to share the costs, or raise prices for Americans. It’s a risky move because if they raise prices too much, customers might stop buying. This situation increases the possibility of a recession in the US and in other countries.