US President-elect Donald Trump, without waiting until he takes office on January 20 next year, has announced his intention to impose 25 per cent customs tariffs on goods coming into America from neighbouring countries Canada and Mexico, as well as reiterating his intentions to impose effectively barrier tariffs on imports from China.
Trump said in a post on Truth Social:
“On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders.”
With such harsh protectionist measures, the American leader, in his own words, is going to force said countries to do more to fight illegal migrants and drugs sneaking into the US. Trump’s sudden announcement collapsed Asian trading exchanges and also sharply depreciated the Canadian and Mexican currencies against the US dollar.
In addition, Trump announced the imposition of “an additional 10 per cent tariffs, on top of any additional tariff, on all numerous products from China entering the United States” due to Beijing’s alleged unwillingness to crack down on drug smuggling into the US.
Damage from new tariffs
Analysts believe the imposition of the tariffs would cause huge damage to Mexico’s auto and electronics industries, which are oriented towards exports to the United States. The annual trade turnover between the two countries is estimated by Mexican authorities at $800 billion. Canada’s case will primarily affect hydrocarbon exports to the US, valued at nearly $200 billion.
Trump’s announcement of the impending imposition of customs tariffs caused a clear consternation among the US geographically closest ally, Canada. As Ottawa immediately stated, Canada’s highest priority is “securing a shared border” and Canada’s border agency is doing everything it can to “disrupt the flow of fentanyl from China and other countries.”
Beijing’s response was more restrained. The Chinese embassy in Washington said:
“The Chinese side has notified the US side of the progress in anti-drug law enforcement operations. All this proves that the idea of China deliberately allowing the flow of fentanyl precursors to the US is contrary to facts and reality. No one wins in a trade or tariff war.”
