/>iWelcome to this month’s issue of The BR International Trade Report, Blank Rome’s monthly digital newsletter highlighting international trade, sanctions, cross-border investment, geopolitical risk issues, trends, and laws impacting businesses domestically and abroad.
Recent Developments
United States implements universal baseline tariffs while pausing reciprocal tariffs—except against China.
- On April 2, President Trump announced reciprocal tariffs on almost all imports into the United States, which his administration rolled out in two phases:
- On April 5, imports from all countries became subject to a 10 percent baseline tariff.
- On April 9, the tariff rate increased for imports from 56 countries and the European Union, countries with which the United States has determined it has the largest trade deficits. This included a 34% tariff on Chinese goods.
- Later, in response to China’s retaliatory tariffs of 34% on U.S. goods (see below), President Trump levied an additional 50% in tariffs on Chinese goods, which China then matched.
- On April 9, President Trump announced a 90-day pause on implementation of the second wave of reciprocal tariffs noted above, except with respect to import of Chinese goods, which saw a further increase in tariffs to 125%.
- Notably, certain products are excluded from the new tariff program, including items subject to Section 232 tariffs and articles that comply with United States-Mexico-Canada Act (“USMCA”) preferential origin rules. See our alert for more details.
Global trading partners react to United States reciprocal tariffs. In the aftermath of President Trump’s reciprocal tariffs announcement, U.S. trading partners have taken differing approaches to President Trump’s new tariffs.
- Some, like Israel, India, and Vietnam, reportedly have contacted the White House to negotiate a deal. When President Trump announced on Truth Social that he was postponing the tariffs, he claimed that more than 75 countries have reached out to negotiate.
- China, in stark contrast, announced retaliatory tariffs of 34 percent, expanded its export controls, and vowed to “fight to the end.” In response, President Trump increased the U.S. tariff on Chinese goods. After a series of escalating moves, at press time, the U.S tariff on Chinese goods stood at 145% (125% for reciprocal tariffs plus a 20% tariff related to the fentanyl crisis), while China is imposing a 125% retaliatory tariff on U.S. goods.
- Meanwhile, the European Union reportedly is doing both: authorizing retaliatory tariffs on around €22 billion of imports of U.S. goods into Europe, while offering a “zero for zero” tariff deal for cars and other industrial products. In response to the Trump Administration’s pause on reciprocal tariffs, the EU has paused its retaliatory measures.
China, Japan, and South Korea meet to discuss possible free trade agreement. On March 30, the three countries held their first economic talks in years, agreeing to “closely cooperate for a comprehensive and high-level” dialogue on a free trade agreement to promote “regional and global trade.” Chinese state media took things a step further, claiming that the countries had agreed to coordinate their response to U.S. tariffs, which South Korea described as “somewhat exaggerated” and which Japan denied.
White House releases public summary of the Report to the President on the America First Trade Policy. On April 3, the White House publicized a summary of various U.S. government agencies’ April 1 report to President Trump on the implementation of his “America First” trade policy, although the summary did not provide definitive details regarding the report’s contents. The summary notes that the report examined a range of China-related trade actions, as well as “simpler, stricter, and more effective” export controls and possible expanded U.S. government review of outbound U.S. investment into China.
President Trump orders new CFIUS review of Nippon Steel’s proposed acquisition of U.S. Steel. On April 7, President Trump called for the Committee on Foreign Investment in the United States (“CFIUS”) to conduct a de novo review of the proposed acquisition of U.S. Steel by Japan’s Nippon Steel. President Trump’s directive comes after former President Joe Biden blocked the acquisition of U.S. Steel prior to his departure from the White House.
European Union considering joining Canada in World Trade Organization case against U.S. steel and aluminum tariffs. On March 12, Canada filed a request for consultations at the World Trade Organization (“WTO”), alleging that U.S. steel and aluminum tariffs are “inconsistent with the United States’ obligations under the [General Agreement on Tariffs and Trade 1994].” Reports indicate that the European Union may join Canada’s complaint as the economic “bloc has a ‘substantial trade interest’ in the issue.” The dispute complaint is largely symbolic in nature, as since 2019, the WTO’s appellate body has been nonfunctioning.
Coalition government formed in Germany amid economic uncertainty. The German center-right Christian Democratic Union (“CDU”), led by Chancellor-in-waiting Friedrich Merz, and the center-left Social Democratic Party (“SPD”) reached an agreement to form a coalition government. The need for a centrist coalition was driven by uncertainty regarding American tariffs and the continuation of the Ukraine War, along with an impetus to keep the Alternative for Germany (“AfD”) party out of power. Merz has touted the agreement as evidence that Germany will be a reliable and capable force in Europe.
Democratic Republic of the Congo seeks critical minerals deal with the United States. Representative Ronny Jackson (R-TX) met with Democratic Republic of the Congo (“DRC”) President Felix Tshisekedi in late March to discuss a potential critical minerals deal between the countries. The potential deal comes as the DRC seeks to secure funding to contain the conflict with the Rwandan-backed M23 rebels in its east. Massad Boulos, President Donald Trump’s senior advisor for Africa, indicated that the White House had reviewed a minerals agreement between the United States and the DRC and that President Trump and Boulos had “agreed on a path forward for its development.”
President Trump extends TikTok sale deadline. On April 4, President Donald Trump announced that he would pause the upcoming ban of TikTok, set for April 5 under a law that President Biden signed last year requiring divestiture of TikTok’s U.S. operations, for another seventy-five days. The extension comes after representatives of ByteDance, TikTok’s parent, reportedly told the White House that the Chinese government would not approve a sale of the company without negotiations over tariffs. President Trump has suggested that he may lower tariffs on U.S. imports of Chinese-origin items if Beijing approves the sale.
Impeached South Korean President Yoon Suk Yeol removed from office. On April 4, South Korea’s Constitutional Court voted unanimously to remove Yoon Suk Yeol, the country’s impeached president, from office for his December 2024 martial law declaration. South Korea will hold a snap presidential election on June 3, 2025.
In Case You Missed It...
Liberation Day: President Trump Unveils Global, Reciprocal Tariffs – What You Need to Know
Blank Rome partner Joanne E. Osendarp, of counsel Timothy J. Hruby, senior counsel Alan G. Kashdan, and associates Brenden S. Saslow, Rachel D. Evans, and Christopher A. Kimura authored this alert assessing the recently announced global tariffs initiated by the Trump administration.
Christopher A. Kimura also contributed to this article.
