Trump Escalates Global Trade War with New Tariff Wave

US President Donald Trump has launched a fresh round of tariffs against key trading partners, pushing ahead with a controversial trade strategy despite global concerns over economic disruption. From Wednesday, a new set of levies will be applied to imports from countries including China, the European Union, India, the UK, and Cambodia.

The new tariff regime imposes country-specific rates—20% on EU goods, 26% on Indian imports, and as much as 49% on products from Cambodia. The White House has confirmed that China will face a combined tariff of 104% on its exports, following the threat of an additional 50% tariff if it proceeds with retaliatory measures. Beijing has pledged to “fight to the end,” calling the move “naked extortion.”

Despite warnings from economists and pushback from business leaders like Elon Musk, Trump remains firm. His press secretary stated that “President Trump has a spine of steel,” as the administration signalled no immediate intent to reverse course.

Markets React, Allies Respond

The financial markets responded with volatility. While Asian and European indices saw a short-lived recovery on Tuesday—London’s FTSE 100 rose by 2.7% and Tokyo’s Nikkei 225 jumped 6%—Wall Street retreated later in the day. The S&P 500 fell 1.6%, dipping below 5,000, while the Nasdaq Composite dropped 2.2%.

US Treasury Secretary Scott Bessent defended the tariffs as being at “maximum” levels and hinted that negotiations with countries running large trade deficits could soon lead to new deals. Trump echoed the sentiment, suggesting potential agreements with countries like South Korea.

Meanwhile, UK Chancellor Rachel Reeves urged calm, stating that markets were functioning effectively and that the UK was seeking a trade resolution with the US. China, however, issued a scathing rebuke, accusing the US of coercive diplomacy.

Despite the global pushback, Trump insists the tariffs are part of a broader effort to rebalance trade. As diplomatic tensions rise, the world watches to see whether this strategy yields negotiation breakthroughs—or deepens global economic strain.