Donald Trump threatened to impose new tariffs on Mexico, Canada and China on his first day in office.
The president-elect, who takes office on January 20 next year, announced that he would introduce a 25% tax on all products entering the country from Canada and Mexico.
Posting on his Truth Social platform, he also threatened to impose additional 10% tariffs on goods from China, on top of those he might impose in one of his first decrees.
What Trump’s tariffs could mean for the UK, EU, China and the world
If implemented, these tariffs could raise prices for the average American consumer on everything from gasoline to cars to agricultural products.
The United States is the world’s largest importer of goods and Mexico, China and Canada are its top three suppliers according to the country’s census data.
More than 83% of Mexican exports were destined for the United States in 2023 and 75% of Canadian exports were destined for this country.
“On January 20, as one of my many first executive orders, I will sign all necessary documents to impose 25% tariffs on ALL products entering the United States on Mexico and Canada, as well as their ridiculous open borders,” Mr. Trump said.
He also spoke out against the influx of illegal immigrants heading into the country.
While migrant apprehensions reached a record high under President Joe Biden’s administration, illegal crossings have declined significantly this year with the introduction of new border restrictions and increased enforcement measures by Mexico.
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Mr. Trump added: “Mexico and Canada have the absolute right and power to easily resolve this long-simmering problem. We hereby demand that they use this power…and until they do, it is time for them to pay a very heavy price!
After issuing his tariff threat, Mr. Trump spoke with Canadian Prime Minister Justin Trudeau and they reportedly discussed trade and border security.
“It was a good discussion and they will stay in touch,” a Canadian source said.
Regarding China, the president-elect said he has “had numerous discussions with China about the massive quantities of drugs, particularly Fentanyl, being sent to the United States – but to no avail.”
“Until they stop, we will impose an additional 10% tariff on China, above any additional tariff, on all of their many products entering the United States of America,” he said. -he writes.
Trump says he ‘loves’ tariffs – but economists are worried
Donald Trump talked a lot during the campaign about his love of tariffs – he said it was his favorite word. When he talks to economists, they generally hate tariffs because they impose an additional type of friction on trade. But it seems very likely that when he arrives, he will impose them.
When you step back, he doesn’t like the fact that the United States has a huge trade deficit – it imports far more physical products than it exports. He considers it a failure. And China has this huge trade surplus – it exports far more than it imports. Germany too, and Europe as a whole too. In the UK we have the same problem as America.
This raises big questions about the nature of the global economy, the health of America’s manufacturing base, and whether it can be improved. But I think a lot of people are very nervous about the potential economic impact of this, and I think part of that nervousness is because they remember the 1930s. That was the last time that countries around the world were raising tariffs, raising tariffs, raising taxes, all these barriers to trade. And that was to some extent the economic spiral that contributed to World War II. So they look at that and say, “We don’t want to do that anymore.” And they hear Donald Trump say the word “tariffs” approvingly, and it horrifies them.
But the reality is that he’s talking about a global economic system that doesn’t really work, or particularly well either. So I think it’s an interesting intellectual moment, but it’s also quite confusing. There is this moment when there is war in Europe, there is nervousness about the energy transition. There are tensions all over the world between the United States and China. And you can understand why, when people hear these words, they can understand them.
The Chinese embassy in Washington said there would be losers on all sides in the event of a trade war.
“Economic and trade cooperation between China and the United States is mutually beneficial in nature,” embassy spokesperson Liu Pengyu said on X. “No one will win a trade war or a tariff war” .
It is unclear whether Mr. Trump will actually follow through on his threats.
He won the recent election in part because of voters’ frustration with inflation and high prices.
Mr. Trump’s nominee for Treasury secretary, Scott Bessent — who, if confirmed, would be one of several officials dealing with tariffs — has previously said that tariffs are a means of negotiation.