WASHINGTON DC: U.S. President Donald Trump signed an executive order Saturday that places 25% tariffs on imports from Canada and Mexico and 10% tariffs on goods from China starting Tuesday, the White House said.
“Both Canada and Mexico have allowed an unprecedented invasion of illegal fentanyl that is killing American citizens, and also illegal immigrants into our country,” White House press secretary Karoline Leavitt said during her briefing Friday.
Trump, who is spending the weekend at his Mar-a-Lago estate in Florida, was not scheduled to speak to reporters.
While Canadian goods will face a 25% tariff, Trump said he would tariff Canadian crude oil imports at 10%. Mexico’s energy imports are included in its 25% tariffs.
For Canada alone, Trump canceled the “de minims” tariff exemption. That exception is for shipments worth less than $800.
China’s 10% would be on top of various tariffs on its goods.
Under the order, there is no process to seek an exception, but there is one to escalate the tariff rates if the countries retaliate in some way.
Canada and Mexico have both said they could impose tariffs of their own on U.S. goods.
Outgoing Canadian Prime Minister Justin Trudeau said his country would respond.
“We’re working hard to prevent these tariffs, but if the United States moves ahead, Canada’s ready with a forceful and immediate response,” he posted on social media.
Meanwhile, Mexican President Claudia Sheinbaum said her country has a “plan A, plan B, plan C for whatever the United States government decides.”
Tariffs could backfire
China, Mexico and Canada account for more than one-third of the goods and services imported into or bought from the United States.
Some economists warn that the tariffs could backfire.
Imports from Mexico and Canada make up around 3% of U.S. GDP, while exports make up around 2.5% of U.S. GDP, said Brad Setser, a senior fellow at the Council on Foreign Relations
A 25% tariff on Mexico and Canada amounts to a “tax hike on imports from those countries” and will “have an immediate and negative impact on the U.S. economy,” he told VOA. “It’s a strategy for shrinking the U.S. economy.”
Trump has long threatened to impose tariffs to pressure countries to help his administration stop illegal immigration and the smuggling of chemicals used for fentanyl.
He has pledged to use tariffs to boost domestic manufacturing and has praised its use as an effective economic policy.
Trump believes that “tariffs are a great source of leverage,” and that he will “convince Canada and Mexico to make big concessions under the threat of tariffs,” Setser said. “But these measures are going to be pretty costly to the U.S.”
Trump acknowledged that the tariffs might cause a “short-term disruption” for consumers but said it would lead to a long-term benefit for U.S. manufacturing.
“Tariffs don’t cause inflation,” he said. “Tariffs cause success.”
The president had vowed Friday to impose sweeping tariffs on semiconductors, pharmaceuticals, steel and aluminum, and oil and gas.
“All forms of medicine and pharmaceuticals,” Trump said. “And we’ll be doing, very importantly, steel, and we’ll also be doing chips and things associated with chips.”
Trump warned he would “absolutely” place tariffs on goods from the European Union.
(VOA)
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