Beijing has announced it will impose an additional 34% tariff on imports from the US, retaliating against taxes announced this week by Donald Trump in line with his aggressive trade agenda. This rate is the same as that announced by the US President against China.

The Ministry of Commerce announced on Friday that the tariff will apply to all imported goods of US origin starting from April 10.

Following the US President’s announcement of 34% “reciprocal” tariffs in addition to existing customs duties, taxes applied to Chinese exports will exceed 60%.

Beijing has condemned the US’s new taxes as “a typical act of unilateral bullying” that “does not comply with international trade rules and seriously damages China’s legitimate rights and interests.”

Chinese Foreign Ministry Spokesperson Guo Jiakun criticized the US’s “reciprocal tariffs” on Thursday, stating that the move seriously violates World Trade Organization rules and undermines the rules-based multilateral trading system.

The spokesperson stated, “China strongly opposes the US’s move and will resolutely take countermeasures to protect its legitimate interests.”

This swift response indicates that Beijing will also play hardball against the US.

Previously, US President Trump had stated that he was willing to make a deal in exchange for Beijing approving the sale of social media company TikTok.

As part of the retaliatory measures, Beijing also imposed export controls on 16 American companies and suspended the eligibility of six US-linked companies to export to China.

Eleven more US companies, including US drone manufacturer Skydio, were added to the unreliable entities list. In addition, China will place further restrictions on the export of certain rare earth minerals.

News of the tariffs on Thursday wiped 2.5 trillion USD from US markets, which experienced their steepest declines since 2020.

According to China’s cabinet State Council, the Chinese tariff will take effect from April 10.

Trump’s tariffs trigger $2.5 trillion wipeout on Wall Street

The Constitutional Court unanimously upheld President Yoon Suk Yeol’s impeachment on Friday, following his declaration of limited martial law in December.

The decision, read by Chief Justice Moon Hyung-bae and broadcast live on television, took immediate effect. The country must hold an early presidential election within 60 days to choose Yoon’s successor, with the election expected to take place on June 3.

Yoon was impeached by the National Assembly in mid-December for violating the Constitution and laws by declaring martial law on December 3, deploying troops to the opposition-controlled National Assembly to prevent lawmakers from voting on the decree, and ordering the arrest of politicians.

Chief Justice Moon stated, “The negative impacts on the constitutional order and the implications of the respondent’s violation of the laws are very grave. The benefits of protecting the Constitution by removing the respondent from office outweigh the national losses incurred by the impeachment.”

The decision concluded a contentious four-month period that began with Yoon’s surprise declaration of martial law, which significantly damaged the country’s political, economic, and social fabric.

In a statement released by his legal team, Yoon apologized to the public for failing to meet their expectations and thanked them for their support.

“My dear citizens, it has been a great honor for me to work for the Republic of Korea,” he said. “I will always pray for the beloved Republic of Korea and for you.”

What offenses did the case involve?

The case centered on whether Yoon violated the law by committing five key actions: declaring martial law, preparing a martial law decree, deploying troops to the National Assembly, raiding the National Election Commission, and attempting to arrest politicians.

The court agreed with all charges, including that he did not meet the legal requirements for declaring martial law. According to the Constitution, a president can declare martial law during wartime or an equivalent national emergency.

Yoon justified his actions by accusing the main opposition party of paralyzing state affairs by repeatedly accusing officials in his administration and attempting to cut the state budget.

The court rejected this claim.

Chief Justice Moon stated, “He neglected his duty to protect the Constitution by undermining the authority of a constitutional institution and infringing upon the fundamental human rights of the people through the mobilization of soldiers and police.”

He added, “The respondent’s actions that violated the Constitution and the laws are a betrayal of the public’s trust and, from the perspective of protecting the Constitution, constitute a grave violation of the law that cannot be tolerated.”

With eight justices currently on the bench, at least six justices had to agree to approve the impeachment motion.

The key issue was not only whether Yoon violated the laws but also whether this violation was serious enough to warrant impeachment.

Yoon did not attend the court for the decision.

How did the ruling and opposition parties react to the decision?

Acting President and Prime Minister Han Duck-soo addressed the nation, pledging to do his best to manage the upcoming elections to ensure a smooth transition to the next administration.

The ruling People Power Party stated that it “humbly accepts” the court’s decision, while the main opposition Democratic Party (DP) hailed it as a “victory for the people.”

DP leader Lee Jae-myung, seen as a leading candidate in the next presidential election, read a separate statement from the National Assembly.

“The great people have reclaimed the great democratic republic, the Republic of Korea,” he said. “Together with the people, we will restore the destroyed livelihoods of the people, peace, the economy, and democracy with a great spirit of unity.”

According to a Gallup Korea poll conducted from Tuesday to Thursday on 1,001 adults, 52% wanted an opposition candidate to win the next election, while 37% supported a candidate from the ruling party.

Lee received the most support as the next head of state, with 34%, followed by Labor Minister Kim Moon-soo from the ruling bloc with 9%. The poll had a margin of error of ±3.1% at a 95% confidence level.

According to Yonhap news agency, the decision led to sharp divisions among Yoon’s supporters and opponents.

Outside the official presidential residence in central Seoul, anti-Yoon protesters gathered, holding signs that read, “Impeach Yoon Suk Yeol.”

A few meters away, a group of Yoon’s supporters expressed their shock. Some angrily hurled abuse, while others fell to the ground and wept loudly.

Second president to be impeached

Thirty-eight days was the longest time the court has taken to issue a decision on a president’s impeachment after the final hearing.

In the past cases of former Presidents Roh Moo-hyun and Park Geun-hye, the court had taken 14 days and 11 days, respectively.

It took 111 days from the day the impeachment motion against Yoon was submitted to the court on December 14.

In addition to the impeachment case, Yoon is also being tried on charges of inciting insurrection through the martial law proposal, a crime punishable by a maximum sentence of life imprisonment or death.

Yoon, who was arrested in January and held in a detention center until early March due to these charges, was released following a court decision that his detention was invalid.

Yoon, who rose from a senior prosecutor to president in three years, became the country’s second president to be impeached.

Yoon, 64, followed in the footsteps of former President Park Geun-hye, who was impeached in 2017 when the Constitutional Court upheld her impeachment over a corruption scandal.

Yoon’s journey

Before reaching the country’s highest office, Yoon began his career as a prosecutor in 1994. He rose to prominence by leading an investigation team into Park’s corruption scandal, ultimately leading to Park’s impeachment and subsequent imprisonment.

In 2019, he was appointed as the country’s top prosecutor by then-President Moon Jae-in but clashed with the administration as he pursued investigations into the family members of former Justice Minister Cho Kuk.

Faced with increasing pressure from the Moon administration, Yoon resigned from his position in 2021. Shortly thereafter, Yoon entered politics and won the 2022 presidential election as the candidate of the conservative People Power Party.

Yoon’s term was marked by conflicts with the National Assembly, which was dominated by the main opposition Democratic Party. Yoon exercised his presidential veto power against 25 bills passed by the National Assembly.

Tensions with the DP peaked in early December when the main opposition introduced motions to impeach the country’s top auditor and a senior prosecutor, leading to Yoon’s declaration of martial law on December 3, which ultimately led to Yoon’s downfall.

Ongoing bilateral trade discussions between India and the US have become crucial for the South Asian nation, especially after being penalized with a reciprocal tariff of 26%.

Economists suggest that while India has managed to avoid the excessive rates applied to regional competitors like Vietnam and Bangladesh, the tariffs make a bilateral agreement essential for New Delhi, which is trying to mitigate the impact on approximately $80 billion worth of exports to the US.

With India’s gross domestic product growth expected to slow to 6.5% in the fiscal year ending March 2025, down from 8.2% in the previous fiscal year, the current tariff levels could inflict a further blow of 70 to 90 basis points, potentially resulting in an export revenue loss of around $30 billion.

“This is a very significant impact, and it’s not a pleasant one at all,” Dhiraj Nim, an India economist at ANZ bank, told Nikkei Asia.

India’s exports in sectors such as electronics, jewelry, and automobiles are among the most affected by the tariffs imposed by US President Donald Trump. For now, the Trump administration has exempted pharmaceutical exports from tariffs.

S C Ralhan, president of the Federation of Indian Export Organizations, stated to local media on Thursday that the relatively lower tariffs imposed on India’s exports could provide an advantage against Asian competitors like China and Vietnam, which have been hit harder.

With this glimmer of hope, Indian stock indices seemed to weather the tariff news better than their Asian counterparts, with the benchmark Nifty 50 and Sensex indices down by approximately 0.2% and 0.27%, respectively, by midday. The Indian rupee weakened to 85.78 against the dollar at the open but recovered to 85.64 by midday.

The Nifty Pharma index outperformed the broader market, rising over 2% by midday.

Economists suggest that the relatively milder tariffs announced against other major economies, coupled with hopes for a bilateral agreement, have supported sentiment in Indian markets.

“The [muted fall] suggests that the markets think that this 26% is unsustainable and this is somewhat of a ceiling tariff rate, and negotiations will bring it down,” Nim added.

A team of US officials visited India last week as part of trade talks aimed at increasing trade between the two countries to $500 billion by 2030. The Indian government stated on Thursday that discussions are ongoing “for an early conclusion of a mutually beneficial, multi-sectoral Bilateral Trade Agreement.”

Unlike China, Canada, and the European Union, India has adopted a more conciliatory stance in response to Trump’s warnings about Washington’s trade deficit (which stands at $45 billion in India’s case), and earlier this year, it reduced tariffs on large motorcycles, luxury cars, and bourbon to appease the US.

According to Bloomberg last week, India is now considering reducing tariffs on agricultural products such as pulses and soybeans, as well as on electric vehicle imports, according to Reuters, which is a major sticking point for Trump ally and Tesla CEO Elon Musk, whose electric vehicle manufacturer has yet to establish a presence in the world’s third-largest automobile market.

In a fact sheet accompanying the tariff announcements, the Trump administration targeted India’s “uniquely burdensome and/or duplicative testing and certification requirements,” stating that removing these barriers would increase US exports by at least $5.3 billion per year.

Sujan Hajra, chief economist at brokerage firm Anand Rathi, wrote in a note: “India’s merchandise trade surplus with the US is far lower than that of China ($320 billion), Mexico ($180 billion), Vietnam ($120 billion), or Germany and Ireland (each at $90 billion). This strengthens India’s position in negotiating a tariff reduction.”

However, economists caution that even with a bilateral trade agreement, India will not be immune to the impact of a potential global trade war that Trump’s “tariff man” declaration threatens to unleash.

“Slowing US growth and weaker global trade momentum will weigh on external demand [for India],” Morgan Stanley Research stated in a note.

“More importantly, we expect this impact to be more visible through the indirect channel of weaker corporate confidence, which will further delay the investment spending cycle [for the country],” it added.

According to economists, this situation may lead to further policy support in India. Morgan Stanley economists suggest that the Reserve Bank of India may shift its stance from neutral to accommodative at its next monetary policy announcement on Wednesday, while Nim from ANZ said that the possibility of a 50-basis-point cut in the benchmark policy rate has “risen significantly.”