Trump to impose 25% tariffs on goods from Canada, Mexico & 10% for China with immediate effect

U.S. President Donald Trump has announced that starting Feb. 1, he will impose tariffs of 25 per cent on goods from Mexico and Canada, and 10 per cent on goods from China.

This move follows his long-standing threats to impose such tariffs since taking office in January and during his campaign, in response to the flow of migrants and fentanyl across the U.S. border from these three countries.

Speaking to reporters in the Oval Office on Jan. 31 (U.S. time), Trump acknowledged that the tariffs could result in higher costs for consumers and may cause short-term disruptions, Reuters reported.

However, when asked what the three countries could do to delay the tariffs, Trump said there was nothing they could do to forestall them.

He also plans to impose tariffs on oil and gas "fairly soon", "around the 18th of February".

Economic disruptions

Mexico, Canada, and China are three of the U.S.'s biggest trading partners, accounting for 40 per cent of the goods imported into the U.S. in 2024, according to BBC.

The tariffs could lead to higher import prices and potentially spark a trade war.

Affected products would include aluminium and lumber from Canada, fruits, vegetables, beer, and electronics from Mexico, and motor vehicles from both countries, Reuters reported.

Trump’s trade policy

During his inaugural address, when he was first sworn in, Trump said he planned to overhaul tariff policy significantly.

"I will immediately begin the overhaul of our trade system to protect American workers and families. Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens."

However, economists have pointed out that tariffs are paid by the companies that import goods, which may pass the added costs on to consumers or accept lower profits.

"President Trump's tariffs will tax America first," Matthew Holmes, public policy chief at the Canadian Chamber of Commerce, told Reuters.

Retaliation

Trump’s decision is expected to provoke retaliatory tariffs, potentially disrupting over US$2.1 trillion in annual two-way trade with the three countries.

In response to the tariff announcement, Canadian Prime Minister Justin Trudeau said Canada would immediately implement "forceful countermeasures," according to Reuters.

"It's not what we want, but if he moves forward, we will also act," BBC quoted Trudeau as saying.

Both Canada and Mexico have previously stated they would retaliate against U.S. tariffs with measures of their own, while also reassuring Washington that they are addressing concerns about their borders.

China has been more reserved regarding its retaliation plans but has vowed to respond.

China "firmly opposes" Trump’s new tariffs, a spokesperson for the Chinese embassy in Washington said, according to Reuters.

"There is no winner in a trade war or tariff war, which serves the interests of neither side nor the world," the spokesperson added.

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