Trump’s trade war impacts Pakistan

WASHINGTON: US President Donald Trump has announced sweeping reciprocal tariffs on dozens of nations, including Pakistan, citing years of what he called unfair trade practices.

The tariffs, set to take effect on April 5, will impact all foreign countries with a baseline 10% tariff, while some will face significantly higher rates.

Pakistan faces 29% tariff while some other countries including Bangladesh and Sri Lanka have been slapped with higher rates. However, Trump was kind to both India and Afghanistan.

Speaking from the White House Rose Garden, Trump explained that the tariffs are calculated by factoring in existing tariff rates and non-monetary barriers, such as currency manipulation.

The base 10 per cent tariffs go into effect on April 5, and the higher reciprocal rates take effect on April 9.

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The effective US import tax rate has shot to 22 per cent under Trump from just 2.5 per cent in 2024, according to the head of US research at Fitch Ratings.

“That rate was last seen around 1910,” Olu Sonola said in a statement. “This is a game-changer, not only for the US economy but for the global economy. Many countries will likely end up in a recession. You can throw most forecasts out the door if this tariff rate stays on for an extended period of time.”

The “reciprocal” tariffs, Trump said, were a response to duties and other non-tariff barriers put on US goods. He argued that the new levies will boost manufacturing jobs at home.

“For decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike,” Trump said.

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.