Trump: “An eye for an eye—reciprocal tariffs for non-tariff barriers”

On the 13th (local time), U.S. President Donald Trump signed a memorandum stating that the U.S. will impose “reciprocal tariffs” on countries by considering their tariff and non-tariff barriers, starting as early as April. Since the criteria for reciprocal tariffs include non-tariff barriers such as export subsidies, the risk of Korea, despite having a free trade agreement (FTA) with the U.S., facing trade restrictions has increased.

After signing the memorandum on “reciprocal trade and tariffs,” President Trump stated at a press conference, “I decided to impose reciprocal tariffs for the sake of fairness,” adding, “There have been many cases where our allies have treated us worse than our enemies in trade.” Reciprocal tariffs refer to imposing import duties equivalent to the tariff rates applied by trading partners to U.S. exports.

President Trump emphasized, “We will set tariffs by considering not only duties on American products but also value-added taxes, regulations, subsidies, exchange rates, and wage suppression in a comprehensive manner.” He further declared, “This will apply to all countries, with no exemptions or deferrals. The era of friends (allies) and enemies taking advantage of the United States is over.” Howard Rutnick, the nominee for Secretary of Commerce, who was present at the press conference, stated, “The administration-level review of reciprocal tariffs will be completed by April 1, and the president will have the opportunity to begin imposing tariffs starting April 2.”

According to the Financial Times (FT), countries with significant trade surpluses with the U.S., such as Mexico and China, are expected to be the first targets of the investigation. The European Union (EU), Brazil, India, Japan, and Canada are also considered at risk of facing reciprocal tariffs.

On the same day, President Trump announced the policy just before a summit with Indian Prime Minister Narendra Modi, whose country maintains a large trade surplus with the U.S. Following their meeting, Prime Minister Modi stated, “We will work to conclude a mutually beneficial trade agreement with the United States,” expressing India’s intention to expand purchases of American weapons and energy.

President Trump also made it clear that he intends to use tariffs to bring back key industries such as automobiles, semiconductors, and pharmaceuticals to the U.S. “Most semiconductors used in the United States are made in Taiwan, with a small number produced in Korea,” he said. “We want the semiconductor industry to return.”


Woo-Sun Lim imsun@donga.com