US trade war: The state of play as Trump signs order imposing new tariffs – but there are more delays
Donald Trump’s trade war has been difficult to keep up with, to put it mildly.
For all the threats and bluster of the US election campaign last year to the on-off implementation of trade tariffs – and more threats – since he returned to the White House in January, the president‘s protectionist agenda has been haphazard.
Trading partners, export-focused firms, customs agents and even his own trade team have had a lot on their plates as deadlines were imposed – and then retracted – and the tariff numbers tinkered.
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While the UK was the first country to secure a truce of sorts, described as a “deal”, the vast majority of nations have failed to secure any agreement.
Deal or no deal, no country is on better trading terms with the United States than it was when Trump 2.0 began.
Here, we examine what nations and blocs are on the hook for, and the potential consequences, as Mr Trump’s suspended “reciprocal” tariffs prepare to take effect. That will now not happen until 7 August.
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What does the UK-US trade deal involve?
Why was 1 August such an important date?
To understand the present day, we must first wind the clock back to early April.
Then, Mr Trump proudly showed off a board in the White House Rose Garden containing a list of countries and the tariffs they would immediately face in retaliation for the rates they impose on US-made goods. He called it “liberation day”.
The tariff numbers were big and financial markets took fright.
Just days later, the president announced a 90-day pause in those rates for all countries except China, to allow for negotiations.
The initial deadline of 9 July was then extended again to 1 August. Late on 31 July, Mr Trump signed the executive order but said that the tariff rates would not kick in for seven additional days to allow for the orders to be fully communicated.
Since April, only eight countries or trading blocs have agreed “deals” to limit the reciprocal tariffs and – in some cases – sectoral tariffs already in place.
Who has agreed a deal over the past 120 days?
The UK, Japan, Indonesia, the European Union and South Korea are among the eight to be facing lower rates than had been threatened back in April.
China has not really done a deal but it is no longer facing punitive tariffs above 100%.
Its decision to retaliate against US levies prompted a truce level to be agreed between the pair, pending further talks.
There’s a backlash against the EU over its deal, with many national leaders accusing the European Commission of giving in too easily. A broad 15% rate is to apply, down from the threatened 30%, while the bloc has also committed to US investment and to pay for US-produced natural gas.
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Millions of EU jobs were in firing line
Where does the UK stand?
We’ve already mentioned that the UK was the first to avert the worst of what was threatened.
While a 10% baseline tariff covers the vast majority of the goods we send to the US, aerospace products are exempt.
Our steel sector has not been subjected to Trump’s 50% tariffs and has been facing down a 25% rate. The government announced on Thursday that it would not apply under the terms of a quota system.
UK car exports were on a 25% rate until the end of June when the deal agreed in May took that down to 10% under a similar quota arrangement that exempts the first 100,000 cars from a levy.
Who has not done a deal?
Canada is among the big names facing a 35% baseline tariff rate. That is up from 25% and covers all goods not subject to a US-Mexico-Canada trade agreement that involves rules of origin.
America is its biggest export market and it has long been in Trump’s sights.
Mexico, another country deeply ingrained in the US supply chain, is facing a 30% rate but has been given an extra 90 days to secure a deal.
Brazil is facing a 50% rate. For India, it’s 25%.
What are the consequences?
This is where it all gets a bit woolly – for good reasons.
The trade war is unprecedented in scale, given the global nature of modern business.
It takes time for official statistics to catch up, especially when tariff rates chop and change so much.
Any duties on exports to the United States are a threat to company sales and economic growth alike – in both the US and the rest of the world. Many carmakers, for example, have refused to offer guidance on their outlooks for revenue and profits.
Apple warned on Thursday night that US tariffs would add $1.1bn of costs in the three months to September alone.
Barriers to business are never good but the International Monetary Fund earlier this week raised its forecast for global economic growth this year from 2.8% to 3%.
Some of that increase can be explained by the deals involving major economies, including Japan, the EU and UK.
US growth figures have been skewed by the rush to beat import tariffs.
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The big risk ahead?
It’s a self-inflicted wound.
The elephant in the room is inflation. Countries imposing duties on their imports force the recipient of those goods to foot the additional bill. Do the buyers swallow it or pass it on?
The latest US data contained strong evidence that tariff charges were now making their way down the country’s supply chains, threatening to squeeze American consumers in the months ahead.
It’s why the US central bank has been refusing demands from Mr Trump to cut interest rates. You don’t slow the pace of price rises by making borrowing costs cheaper.
A prolonged period of higher inflation would not go down well with US businesses or voters. It’s why financial markets have followed a recent trend known as TACO, helping stock markets remain at record levels.
The belief is that Trump always chickens out. He may have to back down if inflation takes off.
Police in Tennessee have discovered 14 improvised explosive devices in a man’s home as they were arresting him, the local sheriff’s office said.
Officers were executing a warrant in the home of Kevin Wade O’Neal in Old Fort, about 45 miles (70km) east of Chattanooga, after he had threatened to kill public officials and law enforcement personnel in Polk County.
After arresting the 54-year-old, officers noticed “something smouldering” in the bedroom where he was found.
Kevin Wade O’Neal. Pic: Polk County Sheriff’s Office
On closer inspection, they discovered an improvised explosive device and evacuated the house until bomb squad officers arrived at the scene.
Fourteen devices were found inside the property – none of which detonated.
Improvised explosive devices were found in Kevin Wade O’Neal’s home. Pic: Polk County Sheriff’s Office
Kevin Wade O’Neal’s home in Old Fort, Tennessee. Pic: Polk County Sheriff’s Office
O’Neal was charged with 11 counts of attempted first-degree murder, corresponding to nine officers and two other people inside the property when the suspect tried to detonate the devices.
He also faces 14 counts of prohibited weapons and one count of possession of explosive components.
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O’Neal is being held at the Polk County jail and his bond is yet to be determined.
Donald Trump says he has ordered two nuclear submarines to be positioned in the “appropriate regions” in a row with former Russian president Dmitry Medvedev.
It comes after Mr Medvedev, who is now deputy chair of Russia‘s Security Council, told the US president on Thursday to remember Moscow had Soviet-era nuclear strike capabilities of last resort.
On Friday, Mr Trump wrote on social media: “Based on the highly provocative statements of the Former President of Russia, Dmitry Medvedev, who is now the Deputy Chairman of the Security Council of the Russian Federation, I have ordered two Nuclear Submarines to be positioned in the appropriate regions, just in case these foolish and inflammatory statements are more than just that.
“Words are very important, and can often lead to unintended consequences, I hope this will not be one of those instances. Thank you for your attention to this matter!”
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Trump: ‘We’re going to protect our people’
Speaking outside the White House later in the day, Mr Trump was asked about why he had moved the submarines and replied: “We had to do that. We just have to be careful.
“A threat was made and we didn’t think it was appropriate, so I have to be very careful. So I do that on the basis of safety for our people. A threat was made by a former president of Russia and we’re going to protect our people.”
The spat between Mr Trump and Mr Medvedev came after the US president warned Russia on Tuesday it had “10 days from today” to agree to a ceasefire in Ukraine or face tariffs, along with its oil buyers.
Moscow has shown no sign that it will agree to Mr Trump’s demands.
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On Thursday, Mr Medvedev reminded Mr Trump that Russia possessed a Soviet-era automated nuclear retaliatory system – or “dead hand”.
Mr Medvedev, a close ally of Russian President Vladimir Putin, was referring to a secretive semi-automated Soviet command system designed to launch Russia’s missiles if its leadership was taken out in a decapitating strike.
He made the remarks after Mr Trump told him to “watch his words” after Mr Medvedev said the US president’s threat of hitting Russia and its oil buyers with punitive tariffs was “a game of ultimatums” and added that “each new ultimatum is a threat and a step towards war” between Russia and the US.
Dmitry Medvedev. Pic: Reuters
Mr Medvedev served as Russia’s president from 2008 and 2012, when Mr Putin was barred from seeking a third consecutive term, but then stepped aside to let him run again.
As deputy chair of Russia’s Security Council, he has become known for his provocative and inflammatory statements since Moscow invaded Ukraine in 2022.
Donald Trump has said “nobody has asked” him to pardon Ghislaine Maxwell, but insisted he has “the right to do it” as US president.
Jeffrey Epstein’s former girlfriend is currently serving a 20-year sentence after being convicted of helping the paedophile financier traffic and sexually abuse underage girls in 2021.
Prosecutors have said Epstein’s sex crimes could not have been done without Maxwell, but her lawyers have maintained that she was wrongly prosecuted and denied a fair trial, and have floated the idea of a pardon from Mr Trump.
Last week, they asked the US Supreme Court to take up her case.
When pressed on the possibility of pardoning Maxwell, Mr Trump told reporters: “I’m allowed to do it, but nobody’s asked me to do it.”
He continued: “I know nothing about it. I don’t know anything about the case, but I know I have the right to do it. I have the right to give pardons, I’ve given pardons to people before, but nobody’s even asked me to do it.”
Mr Trump also said he would not pardon Sean “Diddy” Combs, who was convicted in July on two charges of transportation to engage in prostitution.
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Trump ‘never visited Espstein island’
His comments came shortly after the federal Bureau of Prisons (BOP) said Maxwell has been moved to a minimum-security prison camp in Texas.
She was being held at a low-security prison in Tallahassee, Florida, that housed men and women, but has now been transferred to a prison camp in Bryan, Texas.
When asked why Maxwell was transferred, BOP spokesperson Donald Murphy said he could not comment on the specifics, but that the BOP determines where inmates are sent based on such factors as “the level of security and supervision the inmate requires”.
Maxwell’s lawyer confirmed the move but also declined to discuss the specific reasons for it.
The Texas camp houses solely female prisoners, the majority of whom are serving time for nonviolent offences and white-collar crimes, Sky’s US partner NBC News reports.
Trump and Epstein at a party together in 1992. Pic: NBC News
Minimum-security federal prison camps house inmates considered to be the lowest security risk and some facilities do not even have fences.
A senior administration official told NBC: “Any false assertion this individual was given preferential treatment is absurd.
“Prisoners are routinely moved in some instances due to significant safety and danger concerns.”
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Maxwell has received renewed attention in recent weeks, after the US Justice Department said it would not be releasing the so-called ‘Epstein files’.
The department said a review of the Epstein case had found “no incriminating ‘client list'” and “no credible evidence” the jailed financier – who killed himself in prison in 2019 – had blackmailed famous men.
Officials from the Trump administration have since tried to cast themselves as promoting transparency in the case.
Last month, they lodged a request to unseal grand jury transcripts – which was denied – and Maxwell was last week interviewed by Deputy Attorney General Todd Blanche.
Epstein survivor’s family criticises move
Maxwell’s move to a lower security facility has been criticised by the family of Epstein abuse survivor Virginia Giuffre, who died in April, and accusers Annie and Maria Farmer.
They said in a statement: “It is with horror and outrage that we object to the preferential treatment convicted sex trafficker Ghislaine Maxwell has received.
“Ghislaine Maxwell is a sexual predator who physically assaulted minor children on multiple occasions, and she should never be shown any leniency.
“Yet, without any notification to the Maxwell victims, the government overnight has moved Maxwell to a minimum security luxury prison in Texas.”
The statement concluded: “This move smacks of a cover up. The victims deserve better.”
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