President Trump’s announcement of sweeping tariffs on America’s trading partners has widened the rift between the United States and some of its closest allies while reconfiguring the global economic order.
Mr. Trump’s plan, which he unveiled on Wednesday and is calling “reciprocal,” would impose a wave of tariffs on dozens of other countries. Among major economies hardest hit were the European Union, which will face 20 percent tariffs under the plan, and China, which will absorb an additional 34 percent on top of existing levies.
“The scope and size of tariffs are both substantial and confirm the worst fears of the proponents of free trade,” said Eswar Prasad, professor in the Dyson School at Cornell University. “Trump is setting off a new era of protectionism that will reverberate worldwide.”
Mexico and Canada, two of the United States’ biggest trading partners, would not be subject to any new tariffs beyond the levies the president had previously announced, on imported vehicles, vehicle parts, steel, aluminum, and any other goods not traded under the rules of the U.S.-Mexico-Canada Agreement.
The new levies include a base line 10 percent tariff on all countries except Canada and Mexico, as well as additional tariffs based on the tariffs other nations apply to U.S. exports and other barriers the administration has deemed unfair.
The announcement Wednesday was the latest step in a trade war that has been developing for weeks. Mr. Trump has already imposed steel and aluminum tariffs, announced car tariffs and threatened retaliatory tariffs on European alcohol. He has threatened — and then backed away from — steep levies on goods coming from Canada and Mexico, while imposing a different set on China.
The many-fronted assault has left global partners reeling.
“It is forcing U.S. allies, which have taken for granted for decades that they can count on the U.S., to re-evaluate,” said Adam Posen, president of the Peterson Institute for International Economics in Washington, which supports free trade. “It is already changing America’s role in the world.”
European allies have announced plans to retaliate to an earlier wave of steel and aluminum tariffs, and they have been clear that they could respond to the growing trade conflict by creating barriers for services like big technology companies. Others, like Australia and Britain, have chosen a more wait-and-see approach.
The common thread is that many of America’s friends increasingly find themselves playing defense against Washington, a posture that could change international relations and the global order for years to come.
For countries like the E.U., “it is a very high number,” said Jorn Fleck, senior director with the Europe Center at the Atlantic Council, explaining that the adjustment to such tariffs would be very painful for consumers, workers and businesses.
“These supply chains, you can’t shift them over night,” Mr. Fleck said. “This ignores how a highly integrated trans-Atlantic relationship works.”
Many are questioning what the end goals might be. Mr. Trump has at times argued that he wants to force companies including automakers and drugmakers to produce in the United States. He has also said that the point is simply to rectify unfairness. And he has said tariffs will help to pay for tax cuts.
For America’s global partners, the purpose matters. If the point is to make the trading system more fair, that would suggest an openness to negotiation. Europe could fiddle with any tariffs on cars, for instance, to try to press the Trump administration to take a less aggressive stance.
If the point is to raise money for American coffers, that’s a more difficult starting point for trading partners. In that case, finding an agreement that reduces the planned tariffs would mean reducing any potential revenues.
Given the uncertainty, America’s partners have been trying to learn as much as they can about what’s coming, while rolling out measured responses.
Europe, for instance, has taken a more aggressive posture than many individual nations — announcing plans for retaliatory tariffs on whiskey, motorcycles, farm goods and a wide range of other products in response to steel and aluminum levies. But it has already delayed those measures until the middle of April, and policymakers have yet to announce exactly how they will react to the latest round of tariffs.
Instead, officials have made it clear that they are willing to respond forcefully — including, perhaps, by using a recently created tool that would allow them to relatively quickly place penalties like tariffs or market access restrictions on American technology companies like Google. The tool could also be used to hit other service firms, like banks and other financial services providers, outside lawyers and analysts have suggested.
“Europe holds a lot of cards,” Ursula von der Leyen, president of the European Commission, said earlier this week. “From trade to technology to the size of our market.”
The goal would be to gain leverage. E.U. nations are trying to throw around the weight of the 27-nation bloc’s consumer market to force Washington to negotiate.
That is also why the bloc is, so far, sticking together. Many European nations have made the calculus that, with their combined populations and markets, they are more powerful united.
Still, plans to push back have been made more difficult because other geopolitical topics have become closely interlinked to the trade conflict.
For Europe, military goals and technology regulation have become caught in the dispute. The United States wants the European Union to shoulder more of the burden for its own defense while also dialing back restrictions on large technology companies, including regulations meant to ensure that they are enforcing content standards.
For instance, a White House memo from February suggested that the Trump administration would “consider responsive actions like tariffs” to combat European taxes on digital services and said that two key European technology regulations — the Digital Markets Act and the Digital Services Act — would “face scrutiny.”
The question is how quickly a response will come. European leaders, for instance, have made it clear that they first want to digest the details of the latest round of tariffs.
“They don’t want to escalate — the desire is to do deals,” said Mujtaba Rahman, managing director for Europe at the Eurasia Group, a political research firm. But, he added, there is a risk that the situation escalates and that Europe could be coming after American services within the coming weeks and months.
“You’ve got to flex economic muscle to be credible with this administration,” he noted.
Paulina Villegas contributed reporting from Mexico City.
