Trump pauses most new tariffs

The Donald J. Trump administration declared a trade war with the rest of the world, only to declare a 90-day pause on April 9, the day steep new tariffs would have been enforced. Some 75 countries, Trump says, have contacted administration officials to negotiate.

But China, which has shown no signs of conciliation, will see a 145% tariff, Trump said in a Truth Social post that day. Trump is also instituting a broad 10% tariff on all countries during the moratorium.Trump launched the war on April 2 by instituting the toughest trade barriers in generations. His administration levied new duties of 10% or more on most countries, though they exempt many chemicals and most pharmaceuticals, semiconductors, and energy products.

“April 2, 2025, will forever be remembered as the day American industry was reborn, the day America’s destiny was reclaimed, and the day that we began to make America wealthy again,” Trump said at a gathering in the White House’s Rose Garden to announce the new tariffs.

The White House called the “Liberation Day” measures reciprocal tariffs that would respond to tariff rates in other countries and also take into consideration nontariff trade barriers, such as licensing restrictions and anticompetitive practices.

To address these barriers, the US announced greater duties on certain countries to take effect on April 9. For example, at the time, European Union countries received a 20% tariff, and Japan got a 24% rate.

The White House initially instituted a 34% rate on China. Calling the tariffs a “unilateral bullying practice,” China’s Ministry of Finance imposed a 34% tariff on all US goods to match. Trump responded with another 50%, bringing all the new tariffs against China since he took office in January to 104%. China then raised its rate for US exports to 84%.“

The US’s practice of escalating tariffs on China is a mistake on top of a mistake, which seriously infringes on China’s legitimate rights and interests and seriously damages the rules-based multilateral trading system,” China’s Ministry of Finance says in a statement.In response, Trump jacked up the tariff yet again, to 145%.

Even without the April 9 pause, the chemical industry was spared the brunt of the new tariffs.

The White House has excluded many products from the new duties, including many major chemicals. These products include polymers such as polyethylene, polypropylene, polyethylene terephthalate; petrochemicals like phenols and ethylene; and other large-volume chemicals such as titanium dioxide. The list also has exclusions for pharmaceutical products, semiconductors, and energy products. Some products on the exemption list may be subject to later tariffs.

US chemical industry groups are weighing in on the measures carefully. The American Chemistry Council (ACC) says it is studying them to see how they affect the US industry. “ACC wants to work consistently with the Administration on a pro-growth trade agenda that decreases America’s supply chain vulnerabilities while negotiating new measures that benefit domestic production and jobs,” the group says in a statement.

The Society of Chemical Manufacturers and Affiliates (SOCMA) calls for a “strategic, sector-informed approach” in a statement. “Many SOCMA members are now confronting significantly higher costs for the raw materials they rely on—inputs often unavailable at scale within the U.S.,” the trade group says.

Verband der Chemischen Industrie, Germany’s main chemical trade group, had a harsher response. “The US president has dealt the global economy another blow,” Wolfgang Große Entrup, the group’s director general, says in a statement.

Große Entrup acknowledges the narrow path the European Union walks as it prepares a response to the new tariffs—and to existing tariffs on cars, steel, and aluminum. “Of course, the EU cannot turn the other cheek,” he says. “The chemical industry is at the beginning of all high-value value chains. Finding the right balance between an appropriate response and potential self-harm is the challenge of the hour.”

In a note to clients, Laurence Alexander, a stock analyst with Jefferies, says an important impact of the proposed tariffs would be their effect on chemical demand. The global chemical industry overall will face a roughly 0.8% headwind, he says, while demand for chemicals serving durable goods and clothing markets could see as much as a 6% impact.