1. Home
2. Economy
3. Trump's New Tariffs: A Storm Brewing in Troubled Waters

Donald Trump’s recent decision to impose tariffs on 185 countries and territories sent shockwaves through the global economy. This sweeping policy, which affects nearly the entire world, includes 18 Arab countries, with Lebanon among them. This has raised significant concerns about the potential consequences for the Lebanese economy and its standing in the global market.

President Donald Trump's recent decision to impose historic tariffs on 185 countries and territories, announced on Thursday, has reverberated across the global economy. The repercussions of these tariffs will be felt worldwide, with Arab countries being especially impacted. Among the hardest-hit nations are Syria, Iraq, Libya, Algeria and Tunisia, with rates soaring to as high as 41% for Syria. Lebanon is also included in the list, facing a universal 10% tariff set to take effect on April 5, followed by reciprocal tariffs beginning on April 9.

The primary aim of these tariffs is to reduce the US trade deficit by making foreign products more expensive, thereby encouraging American producers to reclaim market share. While this approach may seem logical from a US perspective, it risks causing significant harm to countries that depend heavily on exports for economic growth.

In a White House speech, Trump explained that the policy is designed to correct global trade imbalances and “restore America’s greatness.” He further emphasized that the tariffs would help revitalize American industry, create jobs and ultimately lower consumer prices while stimulating the domestic economy.

What About Lebanon?

Although Lebanon’s exports to the United States are relatively modest, Trump’s new tariffs could still significantly affect the country’s economy. Lebanon, a major exporter of products such as olive oil, tahini, beer, wine and various agricultural goods, may struggle to maintain its competitiveness in the US market.

In 2024, trade between Lebanon and the US amounted to approximately $570 million in exports and $153 million in imports, a notable increase from $121 million in exports and $705 million in imports in 2023, as reported by Mohammad Abou Haidar, Director General of the Ministry of Economy, in an interview with This is Beirut.

Abou Haidar further clarified that Lebanon’s key exports to the US are fertilizers and natural pearls, while its primary imports include cars and pharmaceuticals.

Nassib Ghobril, Chief Economist at Byblos Bank, suggests that the new tariff measures will have both positive and negative effects on Lebanon. On one hand, the higher tariffs are likely to slow global economic growth, which could lead to reduced global oil demand and lower crude oil prices. This would be a boon for Lebanon, which imports all of its oil, with a projected import bill of $4.4 billion in 2024. The drop in oil prices could significantly reduce Lebanon’s overall import costs, which are expected to reach $17 billion in 2024.

At the same time, the rise in tariffs and the slump in stock markets have caused gold prices to soar, which in turn has increased the value of Lebanon's gold reserves. However, Lebanese exports to the United States are likely to suffer as a result. Another factor to consider is the depreciation of the dollar against the euro, which will make imports from the Eurozone more expensive. That said, Lebanon may offset some of this impact by increasing trade with the US, although Ghobril acknowledges that this shift will be far from easy.

Hani Bohsali, president of the Syndicate of Food Importers, argues that since Lebanon is not a major trading partner of the US, the Lebanese population is unlikely to feel the immediate impact of the new tariffs imposed by Donald Trump. He believes these measures will affect certain Lebanese exports but will not entirely eliminate them. Bohsali also suggests it’s still too early to fully gauge the broader consequences of this shift, as the global oversupply and declining demand could potentially result in lower prices.

Although Lebanon isn't one of the world's largest exporters, it relies on the US market for many of its key products. These goods have gained a solid foothold in the US market, thanks to their high quality and the strong Lebanese expatriate network that plays a key role in sustaining this demand.

However, the introduction of new tariffs could undermine this momentum. Lebanese exports to the United States are likely to lose their competitive edge due to the increased costs associated with these new duties. As a result, Lebanon may experience a significant drop in exports to this key market, at a time when it is already struggling to secure a stronger position in the global economy.

A Global Trade War in the Making

The recent tariffs imposed by Donald Trump extend far beyond Lebanon and Arab nations, affecting some of the world’s largest economic powers. Starting on Saturday, a blanket 10% tariff will be applied to all countries, in addition to existing duties. Moreover, 60 countries identified as the biggest trade offenders will face even higher taxes.

The new measures will come into effect on April 9, targeting major players such as the European Union and China. China will bear the heaviest burden, with a 34% tariff on its exports to the United States. The European Union will face a 20% tariff, India will be hit with 26%, Japan with 24% and Vietnam with a steep 46%.

Even long-standing US allies, such as the United Kingdom, will not be spared, with tariffs rising by 10%. Other countries will experience varying increases: South Africa at 30%, Turkey at 32% and Australia at 24%. In Europe, non-EU nations will face tariffs ranging from 10% (Ukraine and Iceland) to 31% (Switzerland) and 15% (Norway).

Interestingly, countries like Russia, North Korea, Belarus and Cuba are excluded from this list. According to a White House official, these nations are already subject to high tariffs and sanctions, which prevent meaningful trade with the United States.

Additionally, Trump has announced a 25% tariff on foreign-made cars, alongside other restrictions targeting countries that impose barriers on US trade.

Donald Trump's new tariffs are poised to have a global impact, affecting not only major economic powers but also smaller nations like Lebanon. Although Lebanon's exports to the United States are modest, these new trade barriers could further hinder the country's already fragile economic recovery.