Huge gamble

After shocking the world with an announcement of reciprocal tariffs on many of its trading partners, including the Philippines, US President Donald Trump had a change of heart and announced that he was postponing for 90 days the imposition of hefty reciprocal duties on exports of a number of countries into America.

- MARY ANN LL. REYES

A 10 percent blanket duty on almost all US imports will, however, remain in effect. The reversal is also seen as not affecting the raised duties on automobiles, steel and aluminum that are already in place.

The 90-day halt also does not apply to Canada and Mexico since their goods are still subject to 25 percent fentanyl-related tariffs, as well as in the case of China where the tariffs were raised further from the already escalated 104 percent to 125 percent. While more than 75 trading partners of the US did not retaliate and have reached out, China countered with an 84 percent tariff hike.

According to US Treasury Secretary Scott Bessent, this was Trump's plan all along, to use tariffs to create maximum negotiating leverage and to goad China into a bad position.

A Reuters report described the situation after his April 2 announcement of reciprocal tariffs as the most intense episode of financial market volatility since the early days of the COVID-19 pandemic, with trillions of dollars from stock markets being erased and US government bond yields experiencing an unsettling surge that appeared to catch Trump's attention.

The White House said that going big on tariffs and then hitting the pause button before entering negotiations with individual countries was the plan all along, BBC reported. Bessent said that more than 75 countries have already reached out.

So was it really a calculated plan all along by the Trump administration?