trade deficit with China in 2024 was $295.4 billion while imports were $438.9 billion. Dividing $295.4 billion by $438.9 billion equals 67%; dividing 67% by 2 and rounding equals 34%, the “reciprocal” tariff rate for China. The “reciprocal” tariff rate for Vietnam became 46%. The tariff formula used by the Trump Administration focused on trade deficits and did not take into account international trade in services, investments, or the size of a country’s economy. The table below shows total trade, economy size (as measured by gross domestic product (GDP)), and the “reciprocal” tariff rate for the top ten U.S. trading partners. The size of the U.S. economy is an important contributing factor to the U.S. trade deficit with many countries. Simply put, the U.S. can afford to buy a lot more stuff from other countries than they can from the U.S. The size of the U.S. economy dwarfs the economies of many trading partners, being nearly 13 times the size of Canada’s economy and 65 times as large as Vietnam’s economy. 2024 Top Ten U.S. Trading Partners in Goods (Source: U.S. Census, World Bank) Rank Country Exports (billions) Imports (billions) Total Trade % of Trade Reciprocal Tariff Rate 2023 GDP (billions)
--
U.S. Total
2,065.2
3,267.4
5,332.6
100.0% 15.80% 14.30% 10.90% 4.40% 4.30% 3.70% 3.00% 2.80% 2.80% 2.40%
-
27,721
1 2 3 4 5 6 7 8 9
Mexico Canada
334
505.9 412.7 438.9 160.4 148.2 131.5 116.3 136.6
839.9 762.1 582.5
25% 25% 34% 20% 24% 25% 32% 46% 10% 26%
1,789 2,142
349.4 143.5
China
17,795
Germany
75.6 79.7 65.5 42.3 13.1 79.9 41.8
236
4,526 4,204 1,713
Japan
227.9 197.1 158.6 149.7
Korea, South
Taiwan Vietnam
-
430
United Kingdom
68.1 87.4
148
3,381 3,568
10
India
129.2
*tariff rates for Mexico and Canada were established in March The 2025 tariffs implemented by the Trump administration caused many countries to implement their own reciprocal tariffs, with the new tariff rates a function of the rate that the U.S. had placed on imports from their country. On April 9, the Trump administration announced a 90-day pause from the “reciprocal” tariffs announced on April 2, although the global tariff rate of 10% remained in effect. Tariffs remained on goods imported from China, with the tariff rate increasing to over 100% (with certain product exceptions). The 25% tariff rate (with certain product exceptions) was paused for Canada and Mexico on products covered by the USMCA. The 2025 tariffs may have long-term implications for international trade and relations, with countries considering new product sourcing and trading partner options. The table below shows the weighted mean applied tariff rate for the United States and selected trading partners. The weighted mean applied tariff is the average of effectively applied rates weighted by the product import shares corresponding to each partner country. Generally, global tariff rates have been relatively low over the last decade. A brief spike in the U.S. rate occurred in 2019 due to Trump Administration initiated tariffs, but trade wars rescinded in 2020 and tariff rates declined. The U.S. mean tariff rate had spiked to 13.8% in 2019 but declined to 1.5% in 2020. Following the minimum global 10% tariff rate and “reciprocal” rates announced in April 2025, the U.S. mean tariff rate was estimated at approximately 22% according to Fitch Ratings , the highest U.S. mean tariff rate in over 100 years.
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Center for Business and Economic Insight
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