US President Trump’s “Liberation Day” announcement of (1) a 10% baseline tariff effective from 5 April, along with (2) a set of higher, country-specific “reciprocal” rates on 57 trade partners with which the US has trade deficits from 9 April, has jolted global markets. Chinese policymakers have promptly responded with a broad set of countermeasures that mirrors the US move.
Global financial markets have been in turmoil post the “Liberation Day” announcements with stock markets shedding trillions of dollars, credit spreads widening, oil prices tumbling and currencies gyrating wildly.
From a sustainability lens, if tariffs are sustained, they will raise the stakes for the survival or repeal of advanced manufacturing credits in the US Inflation Reduction Act (IRA) – the largest climate legislation in US history.
Ehsan Khoman, Head of Research – Commodities, ESG and Emerging Markets (EMEA), discusses the reverberations of these tariff increases across the sustainability complex, wherein he believes that batteries and battery energy storage systems (BESS) are particularly exposed to the new tariffs given the limits to domestic US manufacturing.