President Trump has announced which one of the most dramatic changes in economic policy in the decades on Wednesday, when the long -standing system of imports of imports of the American substitute for the new tariff system of its own design.

The President said that the tariffs would reverse decades of unjust treatment by the rest of the world and result in factories and workplaces that return to the United States.

“The markets will flourish” and “the country will flourish,” Mr. Trump said on Thursday, because the global financial markets suffered the largest route in the years. He added that other countries “used us for many years.”

Economists’ estimates were far more gloomy, and most predicted that the president’s caring tariffs would probably retaliate the economic growth in the United States, to stimulate consumer costs and make it difficult for companies for companies that depend on international supply chains.

The president’s measure is both consequently and complicated. Here’s what you need to know.

What did the president just do?

Mr. Trump has announced two large tariff plan that applies to most of the world. One component is a 10 percent of the “base” of the base line, which will be widely applied to almost all American imports, except for products coming from Canada and Mexico.

Another measure is what the president calls the “reciprocal” tariff. This levy will be applied to 57 countries that Mr. Trump says have high tariffs and other unjust economic practices that have harmed US exporters. He said it was a reciprocal tariff because he would match the way other countries treat the United States.

But the tariff that Mr. Trump has published is not really based on the tariffs of other countries or other economic obstacles to US trade. The number is calculated on the basis of an American trade deficit, which is a measure of difference between what the United States sells in the country and what it buys from it.

Reciprocal tariffs range from 1 percent to 40 percent and will be added to a 10 percent of the base line.

10 percent of the tariff will enter into force on Saturday and reciprocal rates next Wednesday.

Which countries were the most targeting tariffs?

The tariffs have put a great burden on some of American trade partners, including China, Japan, Germany, India, South Korea, Taiwan and Vietnam.

Significantly, Canada and Mexico were not involved. Mr. Trump hit those countries with 25 percent of their exports to many of their exports last month, although he also exception to the products qualified for the trade agreement signed in 2020, the United States-Mexico-Kanada agreement. The countries are also subject to tariffs that Mr. Trump globally signed up for cars, steel and aluminum, and the administration seems to have decided that the closest neighbors of America do not need further tariffs.

But the new tariffs will hit other allies with significant calls. European goods will face a 20 percent tariff, Japanese goods will face 24 percent and South Korean products 26 percent.

Due to the method of calculating tariffs, the Asian countries that send the United States send a lot of exports but do not buy much in return, they will see some of the highest rates.

Chinese exports are faced with an additional 34 percent of tariffs. This is over 20 percent of tariffs that Mr. Trump has applied in recent months, and the second view from his first term. As a result, some products from China will face a 79 percent tariff.

Vietnam – where many companies have moved their factories after Mr Trump put tariffs on China for his first term – now he will face 46 percent of tariffs on his export, while Cambodia’s export will be taxed to 49 percent.

The White House also did not apply tariffs to Russia, North Korea, Cuba and Belarus, claiming that these countries are already subject to heavy sanctions. But American import from Russia was $ 3 billion last year; Small compared to many countries, but far greater than small countries such as Lesot and the Falkland Islands, which Mr. Trump decided to hit with significant tariffs.

What is the aim of the President?

The president and his advisers say that their goal is to make tariffs so painful that they force companies to produce their products in the United States. They claim that this will create more American jobs and push up salaries.

“If you want your tariff rate equal to zero,” Mr. Trump said outside the White House on Wednesday, “then you build your product right here in America.”

One of the biggest questions is whether the president of this tariff as a negotiating tactic and would be willing to remove them in exchange for concessions from other countries.

The administration gave mixed signals on that front. It seems unlikely that the president will remove the 10 -firm ground -line tariff, which he has released globally. And if the administration truly seeks a deficit of US stores with other countries that will be removed, it could be difficult, if not impossible.

But in the executive order he signed, the president said that if the countries remove their dishonest trade practices or an American trade deficit with them, reciprocal tariffs can come back.

Howard Lutnick, a trade secretary, described the trade barriers of other countries as “the monster you need to kill.”

“Our teams are talking to all great trade partners today,” Mr. Lutnick said on Thursday on Bloomberg Television. “It’s time for them to work a deep search of the soul about how they behave badly and how to correct it.”

How did they come up with numbers?

Mr. Trump said on Wednesday that the tariff rate of each nation would be calculated on the basis of “combined rates of all their tariffs, non-monetary obstacles and other forms of cheating.” But It turned out that their methodology revolves around something more direct: a gap between what America exports to the country and what it imports.

The White House turned off a complicated formulabut it all came down to a simple ratio. It was thought that countries that send more goods now than they buy have a “unbalanced” trade and will face higher tariffs.

This formula does not represent any comparative advantage or the idea of ​​trading countries because some better make some products than others and that countries can trade to maximize their benefits. Instead, the administration’s view of any trade deficit seems to be bad and the tariffs will be applied until it is eliminated.

How do tariffs work?

As they enter into force over the next week, the tariff will immediately increase the costs of an importer who bring the goods to the country. Usually these importers are American companies.

For example, if Walmart brings a $ 10 shoe from Vietnam – which faces a 46 percent tariff – Walmart will owe $ 4.60 in additional tariffs to the US government.

It is less clear what will happen next. Walmart could try to force the costs on the Vietnamese shoe producer, saying that Walmart would pay less for the product. Walmart could reduce his own profit margins and absorb the cost of tariffs. Or that could increase the price for which he sells shoes in his stores to make up for the costs.

Economists have found that when Mr Trump put Tariffs on China for his first term, most of that cost was transferred to consumers. But economic studies have revealed that the tariffs on the steel are a little different; Only about half of these costs were transferred to customers.

The estimates are different, but given the scope of Mr. Trump’s new tariffs, US households could see thousands of dollars of additional costs a year. The estimate published by Yale Budget Lab, a research group, found that US households would pay an average of $ 2,100 on average for an announcement on April 2, with poorer households to pay a higher share of revenue.

Particularly high tariffs that Trump’s administration has applied to many Asian countries means that the price of many consumer items is likely to increase, including shoes, clothing and electronics.

The Government will earn a lot more revenue than the tariff that Trump’s administration has promised to channel tax reduction. The value of the tariff for all goods that the United States introduced last year was $ 78 billion. With the new tariffs announced on Wednesday, the figure would increase to more than $ 1 trillion, according to an analysis of the Worldwide trade partnership, a research company based in Washington.

What happens next to the economy?

The tariff announcement has launched a global decline in stock markets, indicating that investors consider it significantly harmful to the companies that are listed on the list.

It is not yet clear whether or how other countries will take revenge. But if they impose their own tariffs on US products, it will probably hurt us to exporters and could encourage the escalation of trade wars.

Many analysts have quickly reduced their forecasts for economic growth, saying that tariffs will encourage prices for consumers and costs for companies, slowing down demand and economic activity.

Nancy Lazar, the main global economist in Piper Sandler, estimated that the US economy could arrange 1 percent in the second quarter. She had previously expected a flat quarter. “It’s an immediate shot in the economy,” she said.

Economists on Fitch Ratings said on Thursday that the tariffs significantly increased the risk of recession in the United States. It said the tariffs would result in higher consumers’ prices that would squeeze out actual salaries and weigh the consumer consumption.

The tariffs would also lead to a lower corporate profit, which, along with the uncertainty of politics, would withdraw business investments in the United States. All in all, the effect “would probably exceed the benefits that US companies could gain from increased protection by competition,” said Fitch Economist.

Lazaro Gamo and Colby Smith contribute to reporting.