The 'Reciprocal Tariffs' Policy: A Challenge to Global Rules and the Future of Globalization

On April 2 (U.S. Eastern Time), the U.S. government officially announced its "Reciprocal Tariffs" policy. Framed under the banner of so-called "fair trade," this policy seeks to unilaterally adjust tariff rates to address long-standing trade deficits, appease domestic industries, and leverage tariffs as a bargaining tool in diplomatic negotiations. However, in essence, the "Reciprocal Tariffs" policy represents a unilateral and hegemonic challenge to multilateralism. Its disruptive impact on global trade rules, supply chain stability, and the world economy far outweighs any short-term benefits it may bring. The international community must rely on multilateral institutions such as the World Trade Organization (WTO) to push back against the resurgence of protectionism and promote fair and sustainable trade cooperation.

At the core of the "Reciprocal Tariffs" policy lies a deep erosion of WTO rules and the authority of the multilateral trading system. It disregards fundamental principles such as non-discriminatory treatment and binding tariff commitments - cornerstones of global trade governance. Moreover, the U.S. has expanded the scope of considerations for imposing reciprocal tariffs to include domestic value-added taxes, industrial subsidies, digital services taxes, and other areas. Tariffs are being treated as arbitrary tools of economic coercion.

Implemented solely under U.S. domestic law, this policy bypasses the WTO's dispute settlement mechanisms, embodying a "sanction-first, negotiate-later" model of unilateral pressure. Notably, the policy applies selectively to specific countries and regions, revealing its underlying geopolitical motivations masked by rhetoric about "defending rules."

The implementation of this policy is expected to have a profound structural impact not only on North American but also global supply chains, signaling a potential reshaping of globalization.

From a U.S. domestic perspective, numerous economic analyses suggest that rising import costs will weaken consumer purchasing power, increase production costs for businesses, and reduce the global competitiveness of U.S. industries. These effects may ultimately lead to job losses or even business closures. In short, the "Reciprocal Tariffs" policy risks inflicting lasting damage on the U.S. economy.

From a global perspective, retaliatory and defensive measures by other countries in response to the policy are likely to trigger a cascading effect - higher costs, production relocation, escalating retaliation, and fragmentation of supply chains. This could result in irreversible splits in global industrial networks, reduced economic efficiency, and a contraction in total global trade - developments from which no economy can remain unaffected or benefit.

China's Ministry of Commerce has repeatedly emphasized that there are no winners in a tariff war. Dialogue on equal footing remains the only viable path to resolving trade differences. While continuing bilateral consultations and necessary responses with the U.S., China also calls on the international community to make full use of WTO mechanisms. For those countries and economies that value and are committed to defending the multilateral trading system, it is time to take concerted action. Only by working together can the world effectively counter unilateralism and hegemonic behavior, strengthen international order, and uphold the fundamental principles of multilateralism and international law.