By Beiyi Seow and Danny Kemp, AFP
US President Donald Trump holding a chart titled 'Reciprocal Tariffs' during an event at the White House in Washington, DC, on 2 April 2025. Photo: AFP / Brendan Smialowski
The White House on Thursday (US time) blasted a federal court's decision to block many of President Donald Trump's sweeping tariffs, marking a major setback to his trade strategy.
Since returning to the presidency in January, Trump has moved to redraw his country's trade ties with the world while using tariffs as a negotiating tactic to pressure foreign governments to the table.
But the stop-start rollout of levies, impacting both friend and foe, has roiled markets and snarled supply chains.
The three-judge Court of International Trade ruled on Wednesday that Trump had overstepped his authority, and barred most of the duties announced since he took office.
The White House called this ruling "blatantly wrong" on social media, expressing confidence that the decision would be overturned on appeal.
Attorneys for the Trump administration have filed an appeal against the ruling, which gave the White House 10 days to complete the process of halting affected tariffs.
'Nothing's really changed'
Trump's trade adviser Peter Navarro. Photo: Kevin Dietsch / Getty Images via AFP
Trump's trade adviser Peter Navarro told Bloomberg Television: "Nothing's really changed".
"If anybody thinks this caught the administration by surprise, think again," he added.
Director of the National Economic Council Kevin Hassett told Fox Business that although officials have other options that would "take a couple of months" to implement, they were not planning to pursue these right now.
He insisted that "hiccups" because of decisions by "activist judges" would not affect negotiations with other trading partners, adding that three deals were close to finalisation.
Trump's global trade war has roiled markets with import levies aimed at punishing economies that sell more to the United States than they buy.
He argued that resulting trade deficits and the threat posed by drug smuggling constituted a "national emergency" that justified the widespread tariffs - which the court ruled against.
White House spokesman Kush Desai earlier said: "It is not for unelected judges to decide how to properly address a national emergency."
China: 'Cancel wrongful tariffs'
Trump has been using tariffs as leverage in trade negotiations, including with the European Union and China.
Beijing - which was hit by additional 145 percent tariffs before they were temporarily reduced to give space for negotiations - reacted by saying Washington should scrap the levies.
"China urges the United States to heed the rational voices from the international community and domestic stakeholders and fully cancel the wrongful unilateral tariff measures," commerce ministry spokeswoman He Yongqian said.
Canadian Prime Minister Mark Carney said his government welcomed the court decision, but warned that trade ties remain "profoundly and adversely threatened" by the remaining sector-specific levies and further threats.
Japan's tariffs envoy Ryosei Akazawa said Tokyo would study the ruling, as he left for a fourth round of talks in Washington.
Trump unveiled sweeping import duties on nearly all trading partners in April, at a baseline 10 percent -- plus steeper levies on dozens of economies including China and the EU, which have since been paused.
The US court's ruling also quashes duties that Trump imposed on Canada, Mexico and China separately using emergency powers.
But it leaves intact 25 percent duties on imported autos, steel and aluminium.
Asian markets rallied on Thursday but US indexes were mixed around midday. Europe closed slightly down as realisation sank in that the decision might not be a definitive moment.
'Extraordinary threat'
Judges say the case rests on whether the International Emergency Economic Powers Act of 1977 (IEEPA) delegate such powers to the president. Photo: Pool/Getty Images via AFP
The federal trade court was ruling in two separate cases - brought by businesses and a coalition of state governments - arguing the president had violated Congress's power of the purse.
The judges said the cases rested on whether the International Emergency Economic Powers Act of 1977 (IEEPA) delegate such powers to the president "in the form of authority to impose unlimited tariffs on goods from nearly every country in the world."
"The court does not read IEEPA to confer such unbounded authority and sets aside the challenged tariffs imposed thereunder," they said.
The judges stated that any interpretation of the IEEPA that "delegates unlimited tariff authority is unconstitutional."
Analysts at London-based research group Capital Economics said the case may end up with the Supreme Court, but would be unlikely to mark the end of the tariff war.
Trump could explore other sections of US law or seek congressional approval for tariffs.
- AFP
