US President Donald Trump has proclaimed “Liberation Day” in the United States as he prepares to impose tariffs that could escalate trade disputes with global partners, increase prices and upend a decades-old trade order.
Trump has kept the world guessing on the details of the tariff plans, which were still being formulated ahead of a White House Rose Garden announcement ceremony scheduled for 4pm ET on Wednesday (7am AEDT on Thursday).
A person familiar with the administration’s deliberations said the tariffs are expected to be significant and would hit a wide range of countries, including close allies.
The new duties, which would undo trade arrangements in place since 1947, are due to take effect immediately after Trump announces them.
A separate 25 per cent global tariff on car imports will take effect on April 3.
But the White House has not yet published an official notice of either set of tariffs, as it is required to do before they take effect.
“IT’S LIBERATION DAY IN AMERICA!” Trump wrote on his social media platform.
Trading partners are expected to respond with actions of their own.
Trump, who once called the word tariff the “most beautiful word in the dictionary,” has said his reciprocal plans would match US rates with higher levels charged by other countries and counteract their non-tariff barriers that he says disadvantage US exports.
Trump’s trade adviser Peter Navarro said the car tariffs would return strategically vital manufacturing capabilities to the United States.
“This isn’t protectionism. It’s restoration,” he wrote in USA Today.
Doug Ford, premier of the Canadian province of Ontario, said he was not sure whether Trump officials understood the US car industry’s supply chain system, which is tightly linked with other countries.
“This is the most ridiculous thing I have ever seen,” he said on CNBC.
Outside economists have warned that tariffs could slow the global economy, raise the risk of recession and increase living costs for the average US family by thousands of dollars.
Businesses have complained that Trump’s barrage of threats has made it difficult to plan their operations.
“I can’t recall a situation where the stakes were this high and yet the outcome was so unpredictable,” Steve Sosnick, chief strategist at Interactive Brokers, said.
“The devil is going to be in the details and nobody knows the details.”
Across sectors, from cars to ocean freight shipping, luxury goods and beyond, business leaders waited to see what would hit them.
“You cannot make important decisions on your supply chain when the rules of the game keep changing,” said Peter Sand, chief analyst at freight pricing platform Xeneta.
France expected a “pretty powerful” hit that could include tariffs in the range of 20-25 per cent.
In just over 10 weeks since taking office, Trump has imposed new 20 per cent duties on all imports from China and fully restored 25 per cent duties on steel and aluminium, extending these to nearly $US150 billion ($A238 billion) worth of downstream products.
On Wednesday, the administration said that would include all beer and empty aluminium can imports.
A month-long reprieve for most Canadian and Mexican goods from his 25 per cent fentanyl-related tariffs is due to expire on Wednesday.
Administration officials have said that all of Trump’s tariffs stack atop prior rates, so a Mexican-built car previously charged 2.5 per cent to enter the US would be subject to both the fentanyl tariffs and the cars sectoral tariffs, for a 52.5 per cent tariff rate – plus any reciprocal tariff Trump may impose on Mexican goods.
Growing uncertainty over the duties is eroding investor, consumer and business confidence.
Global stocks retreated on Wednesday while safe-haven gold held near record highs.
The US dollar and other currencies held in tight ranges on Wednesday as traders awaited details of Trump’s plans.
Tariff concerns have already slowed manufacturing activity across the globe while also spurring sales of cars and other imported products as consumers rush to make purchases before prices rise.
Trading partners including Australia, the European Union, Canada and Mexico have vowed to respond with retaliatory tariffs and other countermeasures even as some have sought to negotiate with the White House.
Trump has argued that US workers and manufacturers have been hurt for decades by free trade deals that have lowered barriers to global commerce and fuelled the growth of a $US3 trillion US market for imported goods, leading to a goods trade deficit that exceeds $US1.2 trillion.
