Emmanuel Thomas I Wednesday, August 13, 2025
LAGOS, Nigeria – Following his return to the presidency, Donald Trump has reignited his global trade war, enacting a sweeping series of tariffs that have sent ripples through the international economy.
This new wave of protectionist measures, building on policies from his previous term, aims to address what his administration calls “unfair trade practices” and reduce the U.S. trade deficit. However, the outcomes are proving to be complex, creating a mix of winners and losers on both the domestic and international fronts.
Within the U.S., some domestic industries are experiencing a short-term boost. The American steel and aluminum industries, for instance, have praised the tariffs, which they say have led to a decrease in imports and a wave of new investments in domestic production facilities. Similarly, some manufacturing companies that are able to produce goods domestically without relying on imported materials could see an advantage
The New Tariff Landscape
Trump’s latest trade strategy is characterized by a “reciprocal” tariff system, which applies a baseline duty of 10% on most imports and significantly higher rates on goods from countries that his administration deems to be acting against U.S. interests. The average U.S. tariff rate has surged to its highest level since 1933.
Key components of this policy include:
Broad Tariffs: A blanket tariff order has been implemented, with varying rates depending on the country. For example, some allies like the European Union and Japan have agreed to a 15% tariff on their goods to avoid more severe penalties. The United Kingdom secured a lower 10% rate, while other countries like Brazil, India, and Switzerland face much higher duties, in some cases reaching 50%.
Targeted Tariffs: In addition to the broad measures, Trump has implemented targeted tariffs, such as raising the duties on steel and aluminum to 50%. This builds on a policy from his previous term, with the stated goal of protecting American industries from foreign competition.
Trade Truces: The U.S. and China have engaged in a series of temporary tariff cuts and extensions of a “trade truce” as negotiations continue. While this has averted a full-blown trade embargo, the situation remains precarious and subject to change.
Winners: A Mixed Bag of Gains
Within the U.S., some domestic industries are experiencing a short-term boost. The American steel and aluminum industries, for instance, have praised the tariffs, which they say have led to a decrease in imports and a wave of new investments in domestic production facilities. Similarly, some manufacturing companies that are able to produce goods domestically without relying on imported materials could see an advantage.
Globally, some countries that have successfully negotiated lower tariff rates, such as the UK and some Southeast Asian nations, might be considered relative winners, as their goods face fewer restrictions than those from countries that failed to secure a favorable deal. Additionally, some economists suggest that while China’s exports to the U.S. have declined, the country may be finding new markets for its goods, potentially strengthening its economic ties with other nations.
Losers: A Broader Impact
The negative consequences of the trade war are more widespread and affect a diverse range of stakeholders.
U.S. Consumers and Businesses: The most significant losers appear to be American consumers and businesses. Tariffs are taxes paid by importers, and these costs are often passed on to consumers through higher prices. Economists from the Yale Budget Lab estimate that the tariffs could cost the typical American household thousands of dollars per year. Industries that rely on imported materials, such as the automotive, construction, and technology sectors, are facing higher costs, which can limit investment and threaten jobs. Michigan’s auto industry, for example, has warned that the tariffs are hurting profits and global competitiveness.
International Partners: Countries hit with the highest tariffs are facing significant economic challenges. Brazil and India, for instance, are seeing their exports to the U.S. become far more expensive, which could have a damaging effect on their economies. The uncertainty and disruption caused by the tariffs are also creating broader global economic instability, slowing world growth and intensifying trade tensions.
The Global Trading System: The most profound casualty of the trade war may be the international trading system itself. By pursuing a unilateral approach and side-stepping established global organizations like the World Trade Organization, the U.S. is eroding trust and encouraging other nations to re-evaluate their trade relationships. This could lead to a fragmentation of the global economy and a move toward a new, more protectionist world trade order.
However, while Trump’s trade war aims to create a more favorable environment for U.S. industries, the economic data suggests a more complex reality. The benefits appear to be concentrated in a few sectors, while the costs are being borne by a wide range of consumers, businesses, and global partners.
The long-term effects on global supply chains, international relations, and the future of free trade remain a significant concern.
