Americas

Americas

Trump: Foreign governments have to pay "a lot of money" to lift his tariffs

07 April 2025 08:58 (UTC +04:00)

International stock markets have fallen dramatically overnight amid fears of a global trade war following Donald Trump's sweeping tariffs, which he called "medicine", APA reports citing Sky News.

Japan's Nikkei 225 stock index dived nearly 8%, the Singapore benchmark index fell 6.8%, Australia's S&P/ASX 200 fell more than 6%, and South Korea's Kospi lost 4.4%.

Meanwhile US stock market futures signalled further weaknesses, with the future for the S&P 500 losing 4.2% and the Dow Jones Industrial Average falling 3.5%, while the future for the Nasdaq lost 5.3%.

Mr Trump warned foreign governments would have to pay "a lot of money" to lift his tariffs, which he described as "medicine".

"I don't want anything to go down. But sometimes you have to take medicine to fix something," he said on Air Force One.

The US president said he had spoken to leaders from Europe and Asia over the weekend who had hoped to convince him to lower further "reciprocal" tariffs, which are due to come into effect this week.

"I spoke to a lot of leaders, European, Asian, from all over the world," Mr Trump said. "They're dying to make a deal. And I said, we're not going to have deficits with your country. We're not going to do that because to me, a deficit is a loss. We're going to have surpluses or, at worst, going to be breaking even."

Mr Trump, who spent much of the weekend playing golf in Florida, posted on his Truth Social platform: "WE WILL WIN. HANG TOUGH, it won't be easy."

On Saturday, US customs agents began collecting Mr Trump's baseline 10% tariffs on all imports from many countries.

Higher "reciprocal" tariffs of between 11% and 50% on individual countries are due to come into effect on Wednesday.

Mr Trump's tariff announcements have jolted economies around the world, triggering retaliatory levies from China and sparking fears of a global trade war and recession.

Investors and political leaders have struggled to determine whether the tariffs are here to stay, or are part of a permanent new regime or a negotiating tactic to win concessions from other countries.

Goldman Sachs raised the odds of a US recession to 45% in the next few months, joining other investment banks in revising their forecasts amid fears of a trade war.

It comes after Sir Keir Starmer promised "bold changes" as he announced he will relax rules around electric vehicles after carmakers were hit by Mr Trump's tariffs.

The prime minister said "global trade is being transformed" after the US president's 25% levy on imported cars, and 10% baseline tariff on other products, came into force.

stock markets global trade war Trump tariffs Nikkei 225 S&P/ASX 200 South Korea's Kospi S&P 500 Dow Jones Nasdaq global recession tariffs trade tensions US customs

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