Wendy Cutler on President Trump's reciprocal tariff announcement

The reciprocal tariff rates announced Wednesday will come as a shock to our trading partners and will cause harm to the U.S. economy with higher prices, slower economic growth, and slowed down business investment. Our close partners appear to be treated similarly to our rivals, with China’s reciprocal tariff rate just a tad higher than Taiwan. This is difficult to understand given Taiwan’s open economy and extensive manufacturing FDI projects in the United States. 
Our Asian FTA partners were not spared with Korea’s rate at 25 percent at the high end of the group. Asian countries in particular have been hard hit causing them sharp economic pain given their export driven economies.
While the President has underscored that he could have charged a lot more, our partners will not view his actions today as “kind.” Our partners will now be under domestic pressure to respond, while helping their firms weather this storm. 
We can expect global economic growth to start plummeting as trade flows decline, prices increase and businesses put off investments.
Foreign delegations are likely to be all over Washington trying to secure exceptions. We can expect the use of IEEPA to justify these actions being challenged in courts.

(Wendy Cutler, Vice President of Asia Society Policy Institute, New York)