This is the calculation used to calculate Trump’s prices

It turns out that a fairly simple formula was used to calculate the prices of the “Liberation Day” of President Donald Trump.

Samples from goods imported into the United States vary considerably between countries, ranging from 10% to 50%.

The formula used – which has caused the derision of some once revealed by the American commercial representative – consists in dividing the trade surplus of a country or a territory with the United States by the value of its exports to the United States. Then the resulting figure was divided by two, to make the rate rate.

The approach has led to certain rains increase in eyebrows. French territory Saint Pierre and Miquelon, which has around 5,000 inhabitants, has a rate of 50%.

US Census Bureau data shows that $ 3.4 million in goods were imported from the Islands in the United States in 2024, while Saint Pierre and Miquelon imported $ 100,000 in the United States that year so that the commercial imbalance was used to calculate the rate rate.

In a statement published on Wednesday evening, the US trade representative said the prices were “calculated as the tariff rate necessary to balance bilateral trade deficits between the United States and each of our business partners”.

A number of countries, such as the United Kingdom, Singapore and Brazil, have been affected with the basic rate of 10% price. Israel, which has removed all prices on American products, was struck by a 17%sample.

Vietnam, a key competitor of China, is subject to a price of 46%.

“If trade deficits are persistent due to policies and fundamentals pricing and non -tariffs, the rate rate in accordance with the compensation of these policies and fundamental is reciprocal and fair,” said the American commercial representative.

Here is what economists had to say

Economists quickly weighed on the revelation of how the Trump administration calculated the prices.

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“The approach to calculating prices is undoubtedly a more free nature open to potential commercial negotiations in the coming months,” said George Saravelos, FX research manager in Deutsche Bank, in a note.

“It seems that there is no request for a specific policy and identifiable in itself, but ultimately a desire to reduce bilateral commercial imbalances,” he added.

Others have shared a pointed criticism of the approach.

Nouriel Roubini, professor emeritus at the Nyu Stern School of Business, wrote in an article on X that the formula used is “completely imperfect” because it supposes that a fair trade balance must be equal to zero.

“According to this standard, since the United States manages a trade surplus in the services, other countries should impose reciprocal prices of great services against the United States to balance this trade too!” Said Roubini.

Peter Schiff, chief economist and global strategist at Euro Pacific Asset Management, said in an article on X that prices are based on “a false formula which attributes a trade surplus from any country to prices, even if the prices are low or non -existent”.

“The management of a surplus of bilateral trade / deficits with different countries is the way it should be,” wrote Olivier Blanchard, Robert Mr. Solow, professor of MIT emerits. “Trying to eliminate everyone is simply stupid.”

“I have a trade deficit with my grocer, a trade surplus with my employer. I am not sure that it would be a great idea for me to work for my grocer,” he said.