Trump says the US will impose its reciprocal tariffs on April 2

President Donald Trump announced on Tuesday night that the United States will begin enforcing reciprocal tariffs on April 2, planning to match the trade barriers imposed by Europe, China, India, Mexico, and Canada.

Speaking at his now-infamous joint Congressional hearing, Trump claimed that these countries apply “tremendously higher” tariffs on American goods while the US maintains lower rates on imports from them.

So the president vowed to level the playing field by making sure tariff and non-tariff barriers are equal on both sides.

https://t.co/LwOIz29x2t

— Donald J. Trump (@realDonaldTrump) March 5, 2025

But despite Trump’s declaration that the tariffs take effect in April, officials within his administration have informed industry groups that the process may take six months or longer to be fully implemented, per a report from the Journal.

Trump dismissed concerns, telling Congress, “There will be a little disturbance, but we’re okay with that. It won’t be much. Tariffs are about making America rich again and making America great again. And it’s happening, and it will happen rather quickly.”

The remarks came hours after the stock market plummeted for a second straight day, as Trump’s sweeping 25% tariffs on Canada and Mexico took effect.

IMF chief warns that trade is no longer driving global economic growth

Meanwhile, Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), addressed the broader consequences of the US trade shenanigans during a remote appearance at an IMF event in Tokyo on Tuesday. “Trade is no longer the engine of global growth it used to be,” Kristalina said.

Many nations are facing weaker growth prospects and are saddled with high debt while supply chains have come under pressure due to the Covid-19 pandemic and geopolitical developments, Kristalina said.

Kristalina also pointed out that Trump’s administration is actively reshaping policies on trade, taxation, deregulation, public spending, and digital assets, which is forcing other governments to adjust their strategies.

Kristalina then warned that the consequences of Trump’s new tariff plan could complicate global trade relationships and urged Asian economies to embrace digitalization, artificial intelligence, and regional trade to remain competitive.

Canada, Mexico, and China respond to new tariffs

The Trump administration had previously paused the 25% tariffs on Canada and Mexico, but those tariffs officially went into effect on Monday. The decision immediately drew backlash, with concerns that it could damage the trade partnerships between the US and its closest neighbors.

Commerce Secretary Howard Lutnick addressed the situation after the closing bell on Tuesday, saying that Trump “probably” plans to announce tariff compromise deals with Canada and Mexico by Wednesday, and US stock futures rose a bit on the back of that.

But this time, Trump showed no sign of backing down in his Congressional speech, saying, “Mexico and Canada have to do much more than they’ve done, and they have to stop the fentanyl and drugs pouring into the U.S.A.”

The most aggressive reaction to Trump’s tariffs has come from China, which immediately retaliated by imposing up to 15% tariffs on selected American goods, restricting exports to a dozen US companies, and filing a complaint with the World Trade Organization (WTO).

Beijing’s response was accompanied by strong rhetoric, with Chinese Foreign Ministry spokesperson Lin Jian saying on Tuesday that:

“Pressure, coercion, and threats are not the right ways to engage with China. Trying to exert maximum pressure on China is a miscalculation and a mistake. If the US insists on waging a tariff war, trade war, or any other kind of war, China will fight till the end.”

China prepares to fight against US trade pressure

As the US-China trade war escalates, Chinese leader Xi Jinping is preparing to hold a high-stakes political gathering to project economic resilience. Thousands of delegates are set to attend China’s “Two Sessions” meeting, where Xi and his officials will highlight China’s economic and technological ambitions.

The rising tensions between Trump’s administration and China will take center stage on Wednesday morning in Beijing, when Trump’s address to Congress coincides with a speech from China’s No. 2 official, Li Qiang, at the National People’s Congress (NPC).

Li is expected to outline China’s annual economic targets, including military spending, while addressing how Beijing plans to counter US pressure.

Despite the intensifying trade war, Beijing has shown that its gonna stick to its long-term strategy rather than make drastic changes in policy.

An article that was published last Friday in the Communist Party journal Qiushi quoted Xi as saying, “We must face difficulties head-on and strengthen confidence.” The Chinese Communist Party remains in full control, and Xi Jinping holds the most political power of any Chinese leader in decades.

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