Trump tariffs: Canada, Mexico and China face import taxes on Saturday

U.S. President Donald Trump has announced that he will impose tariffs of 25% on Mexico and Canada, respectively, and 10% on China, starting this Saturday. The White House has confirmed this information.

However, Trump stated on Friday that tariffs on Canadian oil would be reduced to 10% and could take effect after February 18. Additionally, he plans to impose tariffs on the European Union in the future, citing the EU's poor treatment of the United States.

White House Press Secretary Karoline Leavitt stated that the tariffs on Canada and Mexico are in response to "the fentanyl that is illegally sourced and allowed to flow into our country, which has killed tens of millions of Americans." Trump has also repeatedly stated that this move is to address the large number of illegal immigrants crossing the U.S. border and the trade deficit with neighboring countries. Leavitt said at a White House press briefing on Friday, "These are promises the President made, and these are promises he is keeping."

During his campaign, Trump threatened to impose tariffs of up to 60% on Chinese-made goods, but on his first day back in the White House, he did not immediately take any action, instead directing his administration to study the issue. Since 2018, U.S. imports of goods from China have leveled off, which economists attribute in part to a series of escalating tariffs imposed during Trump's first term.

Earlier this month, a senior Chinese official warned that Trump's return to the presidency renewed the threat of a trade war between the world's two largest economies, and called for opposition to protectionism, without directly mentioning the United States. Chinese Vice Premier Ding Xuexiang stated at the World Economic Forum in Davos, Switzerland, that China is seeking "win-win" solutions to resolve trade tensions and hopes to expand imports.

China, Canada, and Mexico are major U.S. trading partners, accounting for 40% of total U.S. goods imports last year. There is growing concern that the new high tariffs could trigger a major trade war and push up domestic prices in the United States. Canadian Prime Minister Justin Trudeau said on Friday, "This is not what we want, but if he takes action, we will take action as well."

Canada and Mexico have already stated that they will take corresponding countermeasures in response to U.S. tariffs, while also assuring Washington that they are taking action to address U.S. concerns about their borders. The BBC has contacted the Chinese Embassy in the United States for comment.

If U.S. oil imports from Canada and Mexico are affected by tariffs, it could undermine Trump's promise to lower the cost of living. Tariffs are import taxes levied on goods produced abroad. In theory, taxing goods entering a country means people are less likely to buy them because they become more expensive. The aim is to get people to buy cheaper local products, thereby boosting a country's economy.

However, the cost of energy import tariffs could be passed on to businesses and consumers, which could lead to price increases for everything from gasoline to groceries. About 40% of the crude oil used by U.S. refineries is imported, with the vast majority coming from Canada. Trump acknowledged on Friday that tariff costs are sometimes passed on to consumers, and his plan could cause disruption in the short term.

Mark Carney, the former governor of the central banks of Canada and the UK, said in an interview with the BBC's Newsnight on Friday that tariffs would hit economic growth and push up inflation. "They will damage the reputation of the United States around the world," said Carney, who is also one of the candidates to replace Prime Minister Trudeau as leader of the Canadian Liberal Party.