Tariff whiplash

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Tariff turmoil | Lest we forget – Trump is upending US-China trade | More tariffs (and fees) to come | New and improved research tools

Tariff turmoil

The New York Times reports that Trump whipsaws on tariffs, as detailed in Federal Register notices applying to Canada and Mexico. In the Wall Street Journal, Chao Deng reports that a big chunk of trade remains exposed to tariffs. Sam Lowe describes NAFTA 3.0 and the importance of United States–Mexico–Canada Agreement (USMCA) rules of origin in his Most Favoured Nation blog. The Financial Times uses the Chevy Silverado pick-up truck to illustrate the impact of 25% tariffs. The Wall Street Journal writes that Trump’s trade agencies are struggling to keep up with an expanding work load. Bloomberg provides an explainer on what Trump is trying to achieve with tariffs.

Mentioned publications

1. Trump Whipsaws on Tariffs, Giving Mexico and Canada Reprieve – Ana Swanson and Alan Rappeport, The New York Times, March 6, 2025
   President Trump suspended many of the tariffs on Canada and Mexico just two days after imposing them, exempting USMCA-covered goods and creating confusion among businesses and investors. The decision came after backlash from automakers and farmers, while Canada and Mexico prepared retaliatory measures. Despite this suspension, Trump retained tariffs on Chinese imports and signaled more trade restrictions coming in April.
2. Notice of Implementation of Additional Duties on Products of Mexico Pursuant to the President's Executive Order 14194, Imposing Duties To Address the Situation at Our Southern Border – Notice, Federal Register, March 6, 2025
   The Federal Register confirmed a 25% tariff on Mexican goods, effective March 4, under Executive Order 14194. These duties apply even to USMCA-eligible products, with limited exclusions.
3. Notice of Implementation of Additional Duties on Products of Canada Pursuant to the President's Executive Order 14193, Imposing Duties to Address the Flow of Illicit Drugs Across Our Northern Border – Notice, Federal Register, March 6, 2025
   The Federal Register confirmed additional tariffs on imported products of Canada, effective March 4, under Executive Order 14193. These duties aim to address the illicit drugs flow across the northern border.
4. Big Chunk of North American Trade Remains Exposed to Tariffs – Chao Deng, The Wall Street Journal, March 6, 2025
   President Trump suspended the 25% tariffs on Mexican and Canadian goods for one month, but only for goods qualifying under the complex USMCA rules. Many businesses may now be forced to prove compliance to avoid tariffs. A lower 10% tariff applies to Canadian energy products and potash, adding to confusion and potential legal challenges for businesses and US Customs officials.
5. NAFTA 3.0 – Sam Lowe, Most Favoured Nation, March 6, 2025
   Lowe illustrates why Trump’s temporary exemption from 25% tariffs turns on USMCA rules of origin. Despite Trump’s one-month tariff reprieve for USMCA-compliant automakers, stricter trade rules are likely ahead. To push more production into the US, his administration may raise default tariffs and tighten USMCA rules, making compliance the cheaper option. Meanwhile, upcoming global steel and aluminum tariffs could potentially impact imported derivative products, including hunting and fishing gear.
6. HF sponsored accessHow Donald Trump’s tariffs threaten an iconic US pick-up truck – Financial Times, March 3, 2025
   The Financial Times uses the Chevrolet Silverado to explain how Trump’s tariffs on Mexico and Canada threaten the auto industry’s cross-border supply chains. Automakers like GM, Ford, and Stellantis warn that higher costs and supply chain disruptions could wipe out billions in profits, while shifting production to the US would be costly and slow. Tariffs could also hurt demand and increase migration from impacted regions.
7. Trump’s Tariff Onslaught Is Coming Faster Than His Team Can Carry It Out – Gavin Bade, The Wall Street Journal, February 27, 2025
   Trump is pushing aggressive new tariffs on Canada, Mexico, China, and key industries, but implementation is slowed by bureaucratic bottlenecks. The administration has temporarily reinstated the de minimis loophole after customs faced a massive backlog. While sector-specific tariffs on steel, aluminum, and autos move forward, broader reciprocal trade measures may take months. Meanwhile, Canada and Mexico are ramping up border security efforts, hoping to delay or avoid the tariffs altogether.
8. What Trump Aims to Achieve with His Tariffs – Daniel Flatley and Brendan Murray, Bloomberg, March 4, 2025
   Trump’s aggressive tariffs on China, Canada, and Mexico aim to boost US manufacturing, raise revenue, and serve as diplomatic leverage, but their inconsistent rollout is causing confusion and uncertainty. While China and Canada retaliate with counter-tariffs, Mexico is negotiating to delay them, and new sector-specific duties on steel, autos, and semiconductors are set for April. These tariffs could raise consumer costs, slow economic growth, and escalate trade tensions.

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Lest we forget – Trump is upending US-China trade

Though most of this week’s headlines focused on Canada and Mexico, Trump increased tariffs on all Chinese imports to 20%, as detailed in this Federal Register notice. The New York Times reports on China’s retaliatory measures and the Wall Street Journal finds that China is secretly worried that the US will win the trade war. Martin Chorzempa of the Peterson Institute for International Economics breaks down Trump’s "America First Investment Policy" and what it means for Chinese investment. The South China Morning Post provides 9 takeaways from China’s "two sessions". Matt Gertken, for the Hinrich Foundation, lays out what the US might have in its China policy thinking.

Mentioned publications:

1. Further Amended Notice of Implementation of Additional Duties on Products of the People's Republic of China Pursuant to the President's Executive Order 14195, Imposing Duties to Address the Synthetic Opioid Supply Chain in the People's Republic of China – Notice, Federal Register, March 6, 2025
   The Federal Register notice confirms that President Trump increased additional tariffs on Chinese imports from 10% to 20%, effective 4 March 2025. This move, under Executive Order 14195, aims to address national security concerns related to the synthetic opioid supply chain from China. The tariffs apply to all Chinese products entering the US, excluding specific exemptions, and are in addition to existing duties and fees.
2. China Retaliates Against Trump Tariffs as Superpower Trade War Escalates – Keith Bradsher, The New York Times, March 4, 2025
   Trump’s 20% tariffs on all Chinese imports have triggered strong retaliation from China, including tariffs on US agricultural goods and restrictions on American companies. China is also limiting critical mineral exports and shifting trade toward Europe, while Trump tries to close tariff loopholes like de minimis shipments. As tensions escalate, both sides are testing economic pressure, with Chinese officials pushing for negotiations.
3. China Is Secretly Worried Trump Will Win on Trade – Lingling Wei and Alex Leary, The Wall Street Journal, March 5, 2025
   Trump’s second-term trade war with China is more aggressive, with higher tariffs, economic isolation tactics, and efforts to reshape global trade in favor of the US While China retaliates cautiously and seeks dialogue, Trump is deliberately holding back to maximize US leverage. This escalating rivalry is pushing both nations toward a Cold War-style confrontation over economic and geopolitical dominance.
4. Trump investment order seeks to limit US-China flows, while attracting more from allies – Martin Chorzempa, Peterson Institute for International Economics, February 28, 2025
   Trump’s executive order accelerates US-China financial decoupling, restricting Chinese investment in critical industries while easing investment rules for US allies. It tightens oversight on Chinese firms in US markets and expands restrictions on US outbound investments in sectors like biotech and AI. These measures solidify long-term economic separation between the two countries, with little chance of reversal even if trade negotiations occur.
5. 9 takeaways from the economic briefing at China’s ‘two sessions’ – Mandy Zuo, South China Morning Post, March 7, 2025
   China remains confident in achieving 5% GDP growth, with strong support for technology, trade diversification, and domestic consumption. It refuses to back down in the trade war, while boosting financial reserves, stabilizing the yuan, and managing debt risks. With tighter stock market oversight and policies to attract foreign investment and tourism, Beijing aims to position itself for economic resilience amid global challenges.
6. Trump’s China policy: Phase Two or Phase Nil? – Matt Gertken, Hinrich Foundation, February 18, 2025
   A central question of Trump’s China policy is whether he can negotiate a strategic understanding with Beijing that ensures the US and China have a new mode of living with each other. A Phase Two trade deal is possible, but it only has a moderate chance of success. Other factors influencing Trump’s approach include his hawkish cabinet, China’s economic situation, and the cost of US disengagement from other regions.

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More tariffs (and fees) to come

Next week may (or may not) see the imposition of 25% tariffs on all steel and aluminum imports and possibly other tariffs. The Global Trade Alert focuses on the impact on aluminum and steel derivative products. Reuters reports on Trump’s planned executive order to strengthen US shipbuilding, while the Office of the US Trade Representative asks for comments on proposed fees on operators using Chinese-built vessels. The Financial Times looks at Trump’s investigation into copper dumping. Deborah Elms of the Hinrich Foundation spells out how the US is no longer interested in anything but resetting the world trade order by unilateral order.

Mentioned publications:

1. Imminent U.S. Tariffs on Aluminium & Steel Derivative Products would have covered $151 billion of imports in 2024 – Simon Evenett and Johannes Fritz, Global Trade Alert, March 6, 2025
   The US is imposing 25% tariffs on US$151 billion worth of aluminum and steel derivative products, affecting major exporters like China, Mexico, the EU, and Canada. Key industries hit include automotive, consumer goods, and sports equipment, with tariffs expected to boost US revenues and disrupt global supply chains. This marks a major escalation in US trade policy, straining relations with key trading partners.
2. Trump plans executive order to strengthen US shipbuilding, blunt China domination – Reuters, March 6, 2025
   The US is imposing fees on Chinese-built ships and launching tax incentives and funding programs to revive domestic shipbuilding amid bipartisan concerns over China’s dominance. In parallel, it is securing control of strategic ports, including Panama Canal assets, while proposing trade measures and workforce investments to boost national security. These actions mark a major push to counter China’s influence in global shipping and strengthen US maritime capacity.
3. USTR Seeks Public Comment on Proposed Actions in Section 301 Investigation of China’s Targeting of the Maritime, Logistics, and Shipbuilding Sectors for Dominance – Office of the US Trade Representative, February 21, 2025
   The US Trade Representative has launched a Section 301 investigation into China's dominance in shipbuilding and maritime logistics, proposing fees on Chinese-built vessels. In response, Trump plans to revitalize US shipbuilding through tax credits, grants, and a Maritime Security Trust Fund. These actions aim to curb China's influence in the US$150 billion global shipping industry and strengthen US economic and national security interests.
4. HF sponsored accessUS orders probe into copper dumping, opening door to new tariffs – Myles McCormick, Financial Times, February 26, 2025
   Trump has ordered a Section 232 investigation targeting copper imports, potentially leading to tariffs or quotas as part of his broader protectionist trade push. Investors are growing anxious about the economic impact, while Chile and Canada, the largest suppliers, face the biggest risks. The move aligns with Trump's goal to revive US copper production, following his past efforts in steel and aluminum.
5. What we know about Trump’s reciprocal tariffs – and what we don’t – Deborah Elms, Hinrich Foundation, February 18, 2025
   Donald Trump's plan to impose "reciprocal tariffs" on the world sounds simple, but it is not. Instead of mirroring tariff for tariff, the US will now unilaterally decide a final tariff on all goods from all its trading partners based on five criteria that includes taxes, non-tariff barriers, burdensome requirements on American businesses, and any structural impediments it deems "unfair." What is clear is that the US is no longer interested in anything but resetting the world trade order by unilateral order.

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New and improved research tools

Researchers are producing new and updated tools to track the fast-moving trade policy landscape. Chad Bown of the Peterson Institute for International Economics renews his trade war timeline for Trump’s second term, while the WTO provides a new tariff and trade database for researching tariff schedules.

1. Trump's trade war timeline 2.0: An up-to-date guide – Chad P. Bown, Peterson Institute for International Economics, March 4, 2025
   Trump's second-term trade war has imposed major tariffs on Canada, Mexico, and China, triggering retaliatory measures and market uncertainty. While some tariffs are temporarily paused, global economic tensions continue to rise as negotiations remain uncertain. Chad Bown updates his essential guide tracking the development of the most significant trade actions by the US and other countries.
2. WTO Tariff & Trade Data Integrated Database and Consolidated Tariff Schedules – World Trade Organization (WTO), March 4, 2025
   The WTO's Tariff & Trade Data platform provides official tariff and import data for over 150 economies, combining applied tariffs, import records, and bound duty commitments. It serves as a centralized resource for analyzing and comparing global trade data.

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