The White House announced that President Trump will impose 25% tariffs on imports from Canada and Mexico, and 10% tariffs on goods from China, effective Saturday. The administration offered no details on potential exemptions, raising concerns about rapid price increases for U.S. consumers.
Trump had previously threatened these tariffs to encourage greater cooperation on curbing illegal immigration and fentanyl smuggling. He also aims to bolster domestic manufacturing and increase federal revenue through these measures.
“Starting tomorrow, those tariffs will be in place,” a White House spokesperson told reporters. “These are promises made and promises kept by the president.”
These tariffs pose significant political and economic risks for President Trump, who is just two weeks into his second term. While many voters supported him on his pledge to control inflation, these tariffs could lead to higher prices and disrupt key sectors such as energy, automotive, lumber, and agriculture.
Trump had considered exempting Canadian and Mexican oil imports, but the spokesperson stated they had no information on this matter.
In October, the U.S. imported nearly 4.6 million barrels of oil daily from Canada and 563,000 barrels from Mexico, compared to nearly 13.5 million barrels of daily domestic production, according to the Energy Information Administration.
Trump previously indicated the 10% tariff on Chinese imports would be in addition to existing import taxes on goods from China.
Following the announcement, the S&P 500 stock index declined, erasing its earlier gains.
Both Canada and Mexico have prepared potential retaliatory tariffs, which could escalate the trade conflict, potentially hindering economic growth and accelerating inflation.
Canadian Prime Minister Justin Trudeau stated Canada is prepared to respond to the tariffs but did not specify the details of its response. He emphasized that the response would be purposeful, forceful, and reasonable.
Trudeau warned the tariffs would have “disastrous consequences” for the U.S., jeopardizing American jobs and driving up prices. He also reiterated that less than 1% of fentanyl and illegal crossings into the U.S. originate from Canada.
Mexican President Claudia Sheinbaum noted ongoing dialogue with the Trump administration, but highlighted Mexico’s preparedness with multiple response plans depending on the U.S. government’s actions. She affirmed Mexico’s commitment to defending its national dignity, sovereignty, and equal dialogue.
A Peterson Institute for International Economics study found that the proposed tariffs would harm all involved economies, including the U.S., with particularly catastrophic consequences for Mexico. The study also noted that the economic downturn resulting from the tariffs could paradoxically increase illegal immigration from Mexico.
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AP writers Paul Wiseman in Washington, Jim Morris in Vancouver, Canada, and Christopher Sherman in Mexico City contributed.
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