President Donald Trump has imposed a new 10 percent worldwide tariff after the United States Supreme Court struck down his previous trade measures, triggering immediate concern and responses from governments and markets.
On Friday, Trump announced the decision on his social media platform, Truth Social, saying he has signed an executive order to impose the global tariff, which will take effect “almost immediately”.
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The US top court’s ruling and Trump’s new tariffs have left countries grappling with the legal and economic fallout, raising questions about ongoing agreements, tariff reductions, and the legality of past duties.
Governments are now evaluating how the new levy will affect key industries, investment plans, and trade negotiations, while analysts warn that uncertainty could persist until legal and trade frameworks are clarified.
South Korea
In South Korea, one of the US’s closest allies, the presidential office, Blue House, has released a statement, saying the government will review the trade deal and make decisions in the national interest, casting a question mark over the agreement signed in November last year, which lowered tariffs from 25 to 15 percent in exchange for $350bn in cash and investments from South Korea in the US.
“For major South Korean companies in chemicals, pharmaceuticals, and semiconductors, the Supreme Court ruling has been positive: Even if Trump introduces the new 10 percent tariffs under Section 122, they would still pay a lower rate,” said Jack Barton, an Al Jazeera correspondent in Seoul.
“However, exporters of automobiles, more than half of which go to the US, remain subject to the 25 percent tariff, and steel exports are still hit with 50 percent duties under Section 232, which was not affected by the ruling.”
The South Korean government is expected to move cautiously. Exports account for 85 percent of South Korea’s gross domestic product, with the US as the second-largest market.
“Officials have indicated that rapid changes could jeopardise major agreements, including a recent multibillion-dollar shipbuilding deal with the US and other investments,” said Barton.
“While no definitive policy statement has been made yet, the Blue House has said that the trade deal will be under careful review and changes are likely.”
India
India has faced some of the highest US tariffs under Trump’s previous use of emergency trade powers. The president first imposed a 25 percent levy on Indian imports and later added another 25 percent on the country’s purchases of Russian oil, bringing the total to 50 percent.
Earlier this month, the US and India reached a framework trade deal. Trump said Prime Minister Narendra Modi agreed to stop buying Russian oil and that US tariffs would be lowered to 18 percent for India’s top exports to the US, including clothing, pharmaceuticals, precious stones, and textiles. Meanwhile, India said it will eliminate or reduce tariffs on all US industrial goods and a range of agricultural products.
According to political economist MK Venu, founding editor of Indian publication, The Wire, “Critics have argued New Delhi should have waited for the US Supreme Court decision before finalising the interim trade deal and even trade analysts previously connected with the government have maintained it would have been wiser to wait for the court verdict.”
Venu added that Trump was eager to finalise the trade deal, which includes a commitment to buy $500bn worth of new imports in defence, energy, and artificial intelligence (AI) from the US over the next five years.
While India, he said, welcomed the reduction of tariffs to 18 percent and the removal of penal duties on Russian imports, uncertainty remains over negotiations, as the Supreme Court ruling affects the legal basis of past tariffs.
“The Indian trade delegation is likely to wait for the final outcome of the Supreme Court verdict before proceeding with further negotiations, and countries around the world are expected to follow the court’s ruling rather than rush into trade agreements under legislation deemed unconstitutional,” he said.
China
China has reacted in a muted way to the Supreme Court ruling, with much of the country still on the Lunar New Year break.
Al Jazeera’s Rob McBride, reporting from Beijing, said, “The Chinese embassy in Washington has issued a blanket statement, noting that trade wars benefit nobody, and that the decision is likely to be broadly welcomed in China, which has long been a primary target of Trump’s tariff policies.”
Since last April, he said, China has faced multiple layers of tariffs, including 10 percent on chemicals used in fentanyl production exported to the US and 100 percent on electric vehicles.
Analysts have estimated that the overall tariff level, about 36 percent, could now fall to about 21 percent, providing some relief to an economy already under strain from the COVID-19 pandemic, a prolonged property market crisis, and declining exports.
Shipments from China to the US have reportedly fallen by roughly a fifth over the past year.
“Beijing has sought to offset losses in the US market by strengthening trade ties with Southeast Asian nations and pursuing agreements with the European Union,” McBride said.
“The Supreme Court ruling may also create a more favourable atmosphere ahead of a planned state visit by Trump in early April, when he is expected to meet President Xi Jinping, potentially opening space for a reset in relations between the world’s two largest economies.”
Canada
Canada has welcomed the US Supreme Court’s decision but has pointed out that there are still some challenges ahead.
Regional leaders across the country, including those of British Columbia and Ontario, have signalled that the ruling is a positive step, according to Al Jazeera’s Ian Wood, reporting from Toronto.
However, Minister for Canada-US trade Dominic LeBlanc has said that significant work remains, as Section 232 tariffs on steel, aluminium, softwood lumber, and automobiles have remained in place.
Meanwhile, Ontario’s Premier Doug Ford has added that while optimism has grown, tension has persisted over what Donald Trump will do next, Wood said.
Mexico
Mexico’s president, Claudia Sheinbaum, said her government would be carefully reviewing the Supreme Court’s decision to assess its scope and the extent to which Mexico might be affected.
“The reality is that despite all we’ve heard over the last year about tariffs or the threat of tariffs, Mexico has actually ended up in quite a privileged, even competitive position, especially when compared to other countries,” said Al Jazeera’s Julia Gliano, reporting from Mexico City.
“We have to remember Mexico is the US’s largest trading partner, and the two countries, along with Canada, share a vast trading agreement that shields most products from the so-called reciprocal tariffs that President Trump announced.
“There were also punitive tariffs related to fentanyl and illegal immigration along the US border, which Mexico had managed to suspend while negotiations continued on those matters. Now the tariffs that Mexico has been subjected to on steel, aluminium, and car parts are not affected by today’s decision.”
So, the government here in Mexico, she said, is now standing by to see what the Trump administration comes up with next as it reels from today’s decision by the Supreme Court.
Limits of Trump’s tariff powers
A senior legal scholar told Al Jazeera that the US Supreme Court ruling marks a key moment in the legal battle over Trump’s tariffs, focusing on constitutional limits rather than economics.
Frank Bowman, professor emeritus at the University of Missouri School of Law, told Al Jazeera that the court has for the first time confronted what he called Trump’s broader challenge to the rule of law.
“This is a ruling that is important in several respects. The first, more broadly, is that this is the first time in the last year that the Supreme Court has stepped in and attempted to do something about Donald Trump’s generalised attack on the rule of law in the United States.
“And make no mistake, although tariffs certainly are about economics, what Trump has done over the last year is essentially to defy the law. And the Supreme Court happily decided that they had had enough and that they would say no. So, they’re not ruling on economic policy. They made a decision that the president simply exceeded his constitutional authority.”
