The 2025 Trump Tariff Policy Initiates a Global Trade War: the Global Economy and Markets Severely Impacted

Taiwan • Business • 04/11 18:08
The 2025 Trump Tariff Policy Initiates a Global Trade War: the Global Economy and Markets Severely Impacted

In April 2025, the global tariff policy of U.S. President Trump triggered a full-scale trade war, significantly impacting the global economy, financial markets, business operations, and consumers' lives. The U.S. and China imposed high tariffs on one another, and the EU, along with other countries, took retaliatory measures, resulting in business shutdowns, stock market volatility, and increased demand for precious metals. This policy reshaped the global economic and trade order and triggered international negotiations and created policy uncertainty.

Key Updates

04/12 02:40

US-China Trade War Intensifies: Tesla Stops Selling Imported Models, Sharp Decline in Cargo Ship Bookings Disrupts the Supply Chain

The intensification of the US-China tariff war is impacting the automotive and shipping industries. Tesla in China has stopped accepting new orders for US-manufactured Model S and Model X cars and is only selling existing inventory. Shipping bookings from Chinese ports to the US have sharply decreased, with nearly no ships departing from Shanghai to the US. US ports are congested, leaving thousands of imported cars stranded, and some car manufacturers are delaying shipments to manage tariff uncertainties. This trade conflict is reshaping the operations of global automotive and logistics supply chains.

04/12 02:40

US-China Tariff War Escalates: Trump Slaps 145% Tariffs on Chinese Goods, Taiwanese Manufacturers Face Rush Orders and Pressure to Lower Prices

The US-China trade war is escalating. On April 9, President Trump announced a 145% tariff on Chinese goods and a 90-day suspension of reciprocal tariffs for 75 other countries, imposing only a 10% base tax rate. This move has caused shocks in the global supply chain, with Taiwanese manufacturers receiving a large number of urgent orders but facing pressure to reduce prices. Air freight space is fully booked, and demand for sea freight has surged, keeping logistics providers busy handling the rush. This article analyzes the impact of tariff policies on Taiwanese industries and the global logistics market.

04/12 01:08

US customs system malfunction impacts importers; Navarro urges market confidence as the Trump administration's tariff policy is facing challenges.

On April 11, 2025, the U.S. Customs and Border Protection's customs declaration system malfunctioned, preventing importers from using duty exemption codes, affecting goods from multiple countries and products from China subject to high tariffs. This issue occurred during the period when the Trump administration's new tariff policy was being implemented, exacerbating supply chain disruptions. White House trade advisor Peter Navarro urged investors to enter the market, stating that the tax cut plan and trade agreements would boost a stock market recovery.

04/11 22:39

U.S.-China Trade War Heats Up: Trump Announces 90-Day Tariff Delay, Causing Volatility in Taiwan and U.S. Stock Markets

On April 9, President Trump of the United States announced a 90-day suspension of high tariffs for most trade partners, imposing only a 10% baseline tariff. However, tariffs on Chinese goods were raised to 145%, escalating tensions in the U.S.-China trade war. This move caused turmoil in global financial markets, leading to significant drops in both U.S. and Taiwanese stock markets. Officials from the Federal Reserve pledged to stabilize the markets, and the House of Representatives passed a budget resolution paving the way for extending tax cuts, which raised concerns about fiscal stability. The Taiwanese government launched an 88 billion NT export support plan to address potential threats.

04/11 19:36

2025 U.S. Tariff Surge: Small and Medium-sized Businesses Feeling the Strain, Graduates Confronting Challenges

In April 2025, President Trump of the United States imposed a 145% tariff increase on Chinese goods and maintained a 10% tariff on goods from most trade partners, causing global market fluctuations, a decline in U.S. stock markets, and a spike in gold prices. Import costs for U.S. small and medium-sized businesses rose, intensifying supply chain pressures. However, experts believe a repeat of the 2008 financial crisis is unlikely in the near term. Recent graduates, facing an uncertain job market, demonstrate readiness and adaptability, actively tackling challenges.

04/11 18:08

The 2025 Trump Tariff Policy Initiates a Global Trade War: the Global Economy and Markets Severely Impacted

In April 2025, the global tariff policy of U.S. President Trump triggered a full-scale trade war, significantly impacting the global economy, financial markets, business operations, and consumers' lives. The U.S. and China imposed high tariffs on one another, and the EU, along with other countries, took retaliatory measures, resulting in business shutdowns, stock market volatility, and increased demand for precious metals. This policy reshaped the global economic and trade order and triggered international negotiations and created policy uncertainty.

04/11 16:39

Taiwan Semiconductor Manufacturing Company and Gigabyte Technology expand their operations in the US to counter the US tariff challenges, while Vanguard International Semiconductor Corporation remains focused on the Asian market.

Taiwanese semiconductor and electronics companies are adjusting their global strategies in response to potential high reciprocal duties from the United States. TSMC and Gigabyte have set up plants in the U.S. to strengthen local production; UMC is rumored to be a target for acquisition, attracting attention; Vanguard International Semiconductor has declined to establish a plant in the U.S. and is instead expanding in Singapore. These actions demonstrate the varied strategies of Taiwanese companies in navigating tariff uncertainties.

04/11 16:39

Escalation of the US-China Trade War: Taiwan's Electronics and Semiconductor Industries Benefit from the 145% US Tariff on Chinese Goods, Resulting in a Surge of Urgent Orders

On April 9, 2025, President Trump of the United States announced a 145% tariff on Chinese imports, while postponing high tariffs on other countries for 90 days. This decision caused turmoil in global markets, benefiting Taiwan's electronics and semiconductor sectors as urgent orders from the U.S. surged. The Taiwanese government swiftly responded by starting tariff negotiations with the U.S. and emphasized strengthening regulations to prevent "country of origin" fraud, to ensure the industry's long-term development.

04/11 14:09

Trump's Tariff Policies Spark Global Economic Shockwaves: U.S. Retirement Funds Suffer a $169 Billion Loss, European Central Bank Gears Up, Taiwan-U.S. Tariff Talks Kick Off

On April 2, President Donald Trump announced the implementation of a "reciprocal tariff policy" on 180 countries worldwide, resulting in a $169 billion loss for the top 25 state and local retirement funds in the U.S. within four trading days. The European Central Bank is preparing to tackle financial instability, and the EU forecasts that if the tariffs continue, the U.S. GDP will decrease by 3.3% before 2027. The U.S. has begun tariff negotiations with countries, including Taiwan and Israel. Taiwan is facing a 32% tariff impact and has proposed an industry support plan valued at 8.8 billion New Taiwan dollars.

04/11 13:09

Wells Fargo's first quarter profit surpassed expectations, CEO warns of potential economic impact of tariff risk in 2025.

Wells Fargo, the fourth-largest bank in the United States, announced its first-quarter earnings report on April 11, 2025, with a net profit of $4.89 billion, a 6% increase from the previous year, and earnings per share (EPS) of $1.39, exceeding the market expectation of $1.24. CEO Charlie Scharf warned that the U.S. government's recent tariff increases could hinder economic growth and stated that the bank is prepared for an economic slowdown in 2025. This statement dampened the optimistic sentiment in the banking industry, resulting in Wells Fargo's stock price rising only 1% on the day the earnings report was released.

Tariff Policy Launch: From "Reciprocal Tariffs" to China as the Focus

On April 2, 2025, the Trump administration announced a 10% baseline tariff on all global trade partners and imposed up to 46% "retaliatory reciprocal tariffs" on 60 "worst-offending countries." This move shocked the world, immediately sparking protests and diplomatic negotiations in many countries. On April 9, Trump announced a 90-day suspension of high tariffs for most countries, but increased tariffs on China to 125%, with some goods reaching as high as 145%, making it the main battleground of the trade war.

China quickly retaliated by raising tariffs on U.S. goods from 84% to 125%, covering multiple sectors including agricultural products, automobiles, and electronic equipment. The retaliatory measures from both sides threw the global supply chain into chaos, leaving businesses and markets in a state of high uncertainty.

Global Market Turmoil: Stock, Bond, and Currency Markets Plunge

Trump's tariff policy triggered severe volatility in global financial markets. The Dow Jones Industrial Average fell 5% in a single day, while the S&P 500 and Nasdaq plummeted 5.9% and 6.9%, respectively. Taiwan's stock market opened after the Tomb Sweeping Day holiday with a historic single-day drop of 2,065 points, evaporating NT$6.6 trillion in market value. European stock markets were also affected, with Germany's DAX index down 0.92% and France's CAC 40 index down 0.3%.

The bond and currency markets were equally turbulent. The yield on the U.S. 30-year Treasury bond soared to 4.94%, indicating declining investor confidence in the U.S. economy and policy. The dollar index fell below 100, with funds shifting to safe-haven assets like gold.

Business Operations Hit: Shutdowns, Order Cuts, and Supply Chain Restructuring

Facing high tariffs and policy uncertainty, companies are adjusting their operational strategies. Multinational automaker Stellantis announced a suspension of production in Canada and Mexico, while Jaguar Land Rover and Audi also halted exports to the U.S. In the tech sector, Nintendo and Sony delayed U.S. pre-orders for the Switch 2 and PS5 due to tariff pressures, with prices expected to rise by 30%.

Companies like Apple and Amazon are grappling with whether to pass tariff costs onto consumers. Amazon CEO Jesse admitted that third-party sellers might raise prices. Apple may delay adjustments until the fall product cycle.

Semiconductor companies like United Microelectronics Corporation (UMC) noted that although chips are not directly taxed, clients are either pre-ordering or holding off due to policy concerns, making industry forecasts difficult. Some Taiwanese manufacturers like Foxconn and Quanta have initiated plans to shift production capacity to the U.S.

Consumers Under Pressure: Rising Prices and Supply Shortages

According to Yale University's Budget Lab, Trump's new round of tariffs will raise U.S. consumer prices by 2.9%, ten times the increase since the Smoot-Hawley Tariff Act of 1930. The Tax Foundation estimates that a 10% general tariff will increase annual U.S. household spending by $1,253, with low-income households being particularly affected.

Some companies have listed tariff costs as a "Trump Tariff Surcharge" on checkout totals. High-end brands like Rolex, AP, and Breitling have suspended shipments to the U.S. due to a 31% tariff on Switzerland. Consumers face the dilemma of "having money but nothing to buy."

Specific Industries Hard Hit: Technology and Automotive Bear the Brunt

The technology and automotive industries are the hardest hit in this trade war. Brands like Apple, Nintendo, and Sony, which assemble many products in China, face high tariff pressures. The prices of the Switch 2 and PS5 are expected to rise to $590, while the hardware cost of the iPhone 16 Pro has surged to $846.6 due to tariffs.

In the automotive sector, Tesla has suspended orders for the Model S and X on its Chinese website, and Audi SUVs cannot be sold in the U.S. due to tariffs. Small and medium-sized enterprises in the automotive supply chain also face risks of reduced orders and production disruptions.

Precious Metal Demand Soars: Gold Becomes the Safe Haven of Choice

Amid market turmoil and rising inflation expectations, gold and silver have become safe havens for capital. International gold prices have broken through $3,200 per ounce, reaching a historic high. Taiwan Bank's gold passbook selling price has reached NT$3,414 per gram, with a year-to-date increase of over 21%.

The world's largest gold ETF (SPDR Gold Shares) has increased its holdings to 949.71 tons, the highest since 2022. Silver prices have also risen to $30.76 per ounce, with industrial demand affected by the trade war, but safe-haven demand supporting its price.

Ongoing International Negotiations and Policy Uncertainty

Although Trump has suspended high tariffs for most countries for 90 days, his tough stance on China remains unchanged. The White House stated that over 70 countries have expressed willingness to negotiate, but major trade partners like the EU and Canada still retain retaliatory measures. Economist Paul Krugman pointed out that Trump's erratic policies have severely damaged the U.S.'s international reputation and financial stability.

References

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