Trade war erupts as US tariff deadline passes on Canadian, Mexican, and Chinese goods
WASHINGTON – U.S. President Donald Trump’s new 25% tariffs on imports from Mexico and Canada took effect on Tuesday, along with a doubling of duties on Chinese goods to 20%, launching new trade conflicts with the top three U.S. trading partners and putting global markets on edge.
The tariff actions, which could upend nearly $2.2 trillion in two-way annual U.S. trade, went live at 12:01 a.m. EST (0501 GMT), hours after Trump declared that all three countries had failed to do enough to stem the flow of the deadly fentanyl opioid and its precursor chemicals into the U.S.
China responded immediately after the deadline, announcing additional tariffs of 10%-15% on certain U.S. imports from March 10 and a series of new export restrictions for designated U.S. entities.
Canada and Mexico, which have enjoyed a virtually tariff-free trading relationship with the U.S. for three decades, were poised to immediately retaliate against their longtime ally.
Canadian Prime Minister Justin Trudeau said Ottawa would respond with immediate 25% tariffs on C$30 billion ($20.7 billion) worth of U.S. imports, and another C$125 billion ($86.2 billion) if Trump’s tariffs were still in place in 21 days. He said previously that Canada would target American beer, wine, bourbon, home appliances, and Florida orange juice.
“Tariffs will disrupt an incredibly successful trading relationship,” Trudeau said, adding that they would violate the U.S.-Mexico-Canada free trade agreement signed by Trump during his first term.
Ontario Premier Doug Ford told NBC that he was ready to cut off shipments of nickel and transmission of electricity from his province to the U.S. in retaliation.
Mexican President Claudia Sheinbaum was expected to announce her response during a morning news conference in Mexico City on Tuesday, the country’s economy ministry said.
Trump’s confirmation that the tariffs would proceed sent financial markets reeling with global stocks tumbling and safe-haven bonds rallying. Both the Canadian dollar and Mexican peso fell against the greenback.
The U.S. President’s “America First” agenda, aimed at redrawing trade relationships in favour of the U.S., is expected to be a centrepiece of his Tuesday night address to a joint session of Congress.
