California pleading for tariff exemption amid trade war escalations
The Governor of California, Gavin Newsom, who is a member of the Democratic Party, is addressing Donald Trump's decision by requesting the exclusion of Californian products from retaliatory tariffs. "Newsweek" reports that the richest state in America stands to lose significantly in a trade war.
Governor Gavin Newsom has reached out to international trade partners to seek the exclusion of Californian products from retaliatory tariffs.
Appeal of the California governor
According to "Newsweek," California, known as the richest state in the USA, could deeply feel the consequences of the trade war initiated by Donald Trump.
The governor emphasizes that California is a leader in agriculture and production, with an economy that ranks as the fifth largest in the world. Major corporations such as Google, Apple, and Facebook have their headquarters in California.
Newsom assures that California will remain a reliable trade partner, despite any political turbulence in Washington.
Trump's tariffs: Here are the effects
According to an executive order signed by Trump, new 10-percent tariffs became effective on Saturday, establishing the basic tariff rate for nearly all goods imported into the USA from most countries worldwide.
However, these new tariffs do not apply to Canada and Mexico, which had already been subjected to a 25 percent tax by President Trump. This previous tax affects about half of the imports. Steel, aluminum, cars, car parts, copper, pharmaceuticals, semiconductors, lumber, energy carriers, and minerals not available in the USA are also excluded from these tariffs; however, they will be additionally taxed in the future.
This is just the first phase of the tariffs announced by Donald Trump, ostensibly aimed at introducing reciprocity in trade relations. On April 9, additional taxes are set to be implemented on goods from 57 countries that maintain a trade surplus with the United States.
China and the European Union are among those affected, with additional tariffs of 34 percent and 20 percent, respectively. Japan, South Korea, India, Vietnam, and Taiwan will face tariffs of 24 percent, 25 percent, 26 percent, 46 percent, and 32 percent, respectively.
According to estimates by the Yale Budget Lab, if all the new tariffs take effect as announced by President Trump, the average US tariff rate will escalate from 2.2 percent to over 22 percent. This will be the highest in over a century and notably greater than tariffs in most other countries. Consequently, these tariffs will surpass those enacted by the Smoot-Hawley Act in 1930 during the Great Depression, which historians believe contributed to the protracted duration of the global economic crisis.
