Trump hits China, Mexico and Canada with tariffs

U.S. President Donald Trump has announced new sweeping tariffs on all imports from the United States’ three largest trading partners: China, Mexico, and Canada. Trump stated that goods from Canada and Mexico will face a 25% tariff, while Chinese goods will be subject to a 10% tariff. Canadian energy products will face a lower 10% tariff.

Trump had previously threatened to impose import tariffs if these three countries did not address his concerns about illegal immigration and drug smuggling. The total imports from these three countries accounted for more than 40% of total U.S. imports last year. The White House stated in a post on X on Saturday: “Today’s tariff announcement is necessary to hold China, Mexico, and Canada accountable for their commitments to stop the flow of poisonous drugs into the United States.”

Trump posted on his Truth Social platform: “This is being done through the International Emergency Economic Powers Act (IEEPA), because illegal immigration and deadly drugs, including Fentanyl, pose a major threat to our citizens.” In practical terms, tariffs are domestic taxes levied on goods entering the country, with the rate proportional to the value of the imported goods.

China has warned that Trump's return to the presidency has renewed the threat of a trade war between the world's two largest economies and has voiced opposition to trade protectionism. Chinese Vice Premier Ding Xuexiang stated at the World Economic Forum in Davos, Switzerland last month that China is seeking a “win-win” solution to resolve trade tensions and hopes to expand imports.

Canada and Mexico have stated that they will take reciprocal measures in response to U.S. tariffs on their goods, while also trying to assure Washington that they are taking action to address U.S. border concerns. To avoid tariffs completely, Ottawa had pledged 1.3 billion Canadian dollars ($900 million; £700 million) in new security measures at its U.S. border.

The Canadian Chamber of Commerce issued a statement calling Trump’s decision on tariffs “deeply troubling.” The statement pointed out that the tariffs would have a “direct and immediate” impact on the lives of Canadians and Americans, and would “significantly increase the cost of all goods for everyone.”

The White House explained why it is targeting its major trading partners, stating that Mexican drug cartels are responsible for the smuggling of fentanyl, methamphetamine, and other drugs. The White House also said that tariffs on Canada would remain until Canada “cooperates with the U.S. in combatting drug smuggling and border security.” Finally, the White House stated that “China plays a central role in the fentanyl crisis” and exports the deadly synthetic painkiller.

Canadian Prime Minister Justin Trudeau is scheduled to speak to the media on Saturday evening. The tariffs on Canada are set to take effect on Tuesday.