Trump's tariff gambit: Tensions rise on a global trade stage

US President Donald Trump will announce the details of the reciprocal tariffs mechanism on Wednesday evening, at about 3:00 PM Eastern Time. Trump's plan regarding US tariff policy is seen as an escalation of the trade war. From the beginning, the American president has argued that the principle of the new tariffs is simple: "whatever they charge us, we will charge them." Initially, it was mentioned that the US would impose levies on countries with which they have the most significant trade deficits.

On Sunday, the American president announced that the tariffs might cover "all countries."

We are going to be very nice by comparison to what they were. The numbers will be lower than what they have been charging us, and in some cases, maybe substantially lower – Trump declared.

The Washington Post reported, meanwhile, that White House advisors have prepared a plan to impose a 20% tariff on most imports to the United States. Secretary of State Marco Rubio announced that the new tariffs are supposed to be a new basis for negotiating bilateral agreements with partners.

Wojciech Jakóbik, an analyst from the Center for Energy Security, emphasizes that we don't know what Donald Trump will announce on Wednesday.

– And what he will "launch" this time, says Jakóbik. We also don't know what the effects of his decisions will be. The American president is unpredictable and can change his mind daily, notes Jakóbik.

In his opinion, if the tariffs cover all goods, the impact will be global and difficult to predict.

– If he strikes at most US imports, he will receive a blow in return. And this is because tariffs in the energy and fuel sector would also strike at Trump's "drill, baby, drill" policy, which promised significant reforms in the US energy policy and a break from Joe Biden's policies. According to the analyst from the Center for Energy Security, America's partners may respond by seeking resources elsewhere.

Meanwhile, Daniel Boćkowski, an international security specialist and professor at the University of Białystok, believes that Trump's decision will benefit no one.

– Just as in the 1930s with the American tariff war. We didn't have a global economy back then, and the effects on the world were disastrous. Currently, the economic cycle and the chain of trade exchanges are structured so that Trump would not necessarily be able to force other countries to meet US demands, says Prof. Daniel Boćkowski.

According to the expert, the announcement of imposing tariffs is more for domestic consumption. – Trump wants to show Americans he is doing everything to improve their situation, comments Boćkowski.

Some economists draw comparisons to the tariff hikes made by the US during the Great Depression under the Smoot-Hawley Tariff Act of 1930. That tariff increase extended the global economic crisis. Let us note that the US has already temporarily introduced some tariffs, and some products from Canada and Mexico have been affected.

This time, however, they would also cover products from the European Union. – We do not want retaliation, but we have a firm plan for such actions if necessary, announced European Commission President Ursula von der Leyen on Tuesday in the European Parliament.

In mid-March, the US administration announced a 25% increase in tariffs on EU steel, aluminum, cars, and automotive components. This policy also covers additional sectors like pharmaceuticals, semiconductors, and wood. In response to these tariffs, the European Commission announced the imposition of retaliatory tariffs by the EU on goods from the United States valued at approximately $28 billion.

As Prof. Daniel Boćkowski reminds us, the European Union is a traditional enemy for Trump's electorate.

– Also for the businessmen associated with the Republican leader. For them, the Union is an economic structure that prevents actions and doing business with individual countries. Even during Trump's first presidency, he did not hide that the breakup of the European Union is a goal of the United States. He wanted to remove one of the major players from circulation. Currently, we are seeing a continuation of this policy, of internally dividing Europe, states Prof. Daniel Boćkowski.

He emphasizes that if Trump imposes tariffs on Europe, Europe will also respond with tariffs. – There is no mercy here. Because we cannot afford actions where we are attacked unilaterally, tariffs on both sides will complicate our lives. Unfortunately, the European Union will have a problem, as "a bit" of these goods are linked to the USA. In the other direction, there are fewer. But this serves nobody, as it will be passed on to the consumer, as assessed by the professor from the University of Białystok.

– After all, companies will not pay higher tariffs, and the receiver will have to pay more. We are facing a chilling effect. Trump has decided to act solely from the perspective of strength. He believes that America will be great when everyone fears her, adds Boćkowski.

In his opinion, if Trump imposes tariffs on everything, not all companies and businesses will suddenly move to the United States.

– America is too weak for this. There is not enough infrastructure or production lines there. As a result, some products will disappear, and some will become more expensive. Trump's America is not the strength of Ronald Reagan's time. And it may encounter a strong response from many countries, claims Boćkowski.

Wojciech Jakóbik reminds us that it has been almost 100 years since the Americans' tariff war, which had catastrophic effects.

– But now we live in different economic and political realities. Copying those decisions cannot be effective. It stems from the needs of internal politics. Donald Trump is a hostage of his election slogan, "Make America Great Again." However, going to a tariff war may not make it great; it will only create more enemies, summarizes Jakóbik.