At 12.01am EST (04:01 GMT) on Wednesday, United States President Donald Trump’s “reciprocal” tariffs will kick in, ramping up a global trade war that has roiled stock markets and set businesses on edge.
Trump has long promised tariffs on US trade partners, including while on the campaign trail for the top job last year.
Some targeted duties, including those on steel and aluminium, have been in place for weeks.
On April 2, Trump unveiled his “Liberation Day” tariffs against dozens of countries, sending stock markets into a nosedive as investors digested the prospect of an end to the era of globalisation and free trade.
Since then, several prominent Trump supporters have raised concerns about his trade salvoes.
Bill Ackman, chief executive of hedge fund Pershing Square Capital Management, publicly called on the administration to pause the tariffs to give time for the US and its trade partners to strike deals.
On Tuesday, White House Press Secretary Karoline Leavitt made clear that Trump had no intention of delaying the tariffs, despite more than 70 countries having reached out to begin negotiations.
As the midnight deadline approached on Tuesday evening, analysts were resigned to the tariffs becoming a reality.
“I expect the tariffs to go into effect as announced,” Gary Hufbauer, a non-resident senior fellow at the Peterson Institute of International Economics, told Al Jazeera.
“This will be painful for consumers and spike business uncertainty. The stock market will fall further.”
Rachel Ziemba, an adjunct senior fellow at the Center for New American Security, said she expected negotiations to continue, even as Trump is “doubling down on tariffs on China and sticking with the other tariffs”.
The challenge is the fact that “Trump’s desire for no trade deficits will make it hard to craft deals”, Ziemba said.
Economists say that will prices will inevitably rise for consumers – the only question is by how much.
‘Tit-for-tat is on’
As the world reacts, the most significant country to watch will be China.
After Trump said he would impose an additional 50 percent tariff on China in response to its retaliatory measures, import taxes on Chinese goods are set to rise to a staggering 104 percent.
“A 100 percent China tariff will shut off all Chinese exports to the US,” Vina Nadjibulla, vice president, research and strategy at the Asia Pacific Foundation of Canada, told Al Jazeera.
That would not only drive up prices in the US, which is heavily reliant on Chinese imports, but is also likely to push Beijing to expand trade in other markets, including Europe and South East Asia, leading to ripple effects for those economies.
“The more China-US [trade war] escalates, the more the repercussions on South East Asian nations and other economies around the world,” Nadjibulla said.
Apart from China, the European Union last week announced a number of countermeasures, as did Canada. Other major trade partners, including Japan, South Korea, Vietnam, have declined to retaliate and are in negotiations with the US.
The outcome of those trade talks will be closely watched by the markets in the coming days and weeks, with investors desperately seeking clarity on whether Trump’s tariffs are a temporary negotiating tactic or just the beginning of a permanent reordering of global trade.
Ziemba said that investors would be advised to sit tight until then.
“Don’t borrow to invest and don’t invest money that you might need right away,” Ziemba said.
“For now, tit-for-tat is on, and the global economy will be challenged by it,” she added.