April 2025 Newsletter

US President Donald Trump marks 100 days in office on 30 April. And what a roller-coaster ride it has been as he implements his ‘Make America Great Again’ agenda at breakneck speed and, in doing so, disrupts the rules on global trade, security and international relations.

The market turmoil unleashed by the barrage of new US ‘reciprocal’ tariffs on “Liberation Day” caused stocks, bonds and commodities around the world to plunge on fears of an all-out global trade war and a recession, wiping around USD10 trillion from equity markets worldwide.

Within 12 hours of the tariffs coming into effect on 9 April, the US government reversed course, announcing a 90-day pause. With the notable exception of China, which saw tariffs increased to 125%, all other countries subjected to reciprocal rates saw them drop back to the universal 10% rate. This pause, it said, would give countries a chance to strike trade deals.

The markets responded well, although still down on pre-Liberation Day levels. But as we write this, punitive tariffs on the world’s second largest economy remain, the 90-day respite will eventually end, and 10% base level tariffs still apply across the board.

The only certainty seems to be continued uncertainty. Market volatility is likely to remain elevated in the weeks and months ahead as investors assess rapidly shifting tariff developments and consider the potential implications for growth, inflation, central bank policy and financial markets.

At Sovereign, we are very conscious that many of our clients will be struggling to navigate these stormy waters, either because their business strategies, supply chains and profit margins have been caught in the crossfire of the trade war, or because the current turmoil is causing businesses and consumers to put investment and spending plans on hold.

In both cases, Sovereign is here to help. With the pause on tariffs in place, it’s essential for businesses to review their supply chains, business structures and tax planning, and consider the commercial and compliance implications of a more difficult trading environment.

If your business needs to be reorganised, we can review and advise on alternative options and structures to address issues. Please contact your Sovereign advisor if you need assistance.

We would also like to draw readers’ attention to the Isle of Man Jurisdiction Profile in this month’s Sovereign Report. Our Isle of Man office is one the oldest and busiest in the Group, but rarely seems to attract the attention it deserves. I hope you will learn more about the wealth of opportunities available in this tax-efficient, responsible and dynamic ‘whitelist’ international finance centre.