Washington – President Donald Trump He said on Monday that 25% of imports on imports from Mexico and Canada would start on Tuesday, causing renewed fears before the trade war in North America, which has already shown signs of increasing inflation and growth difficulty.
“Tomorrow – 25% tariffs in Canada and 25% in Mexico. And it will start, “Trump told reporters at Roosevelt Room. “They will have to have a tariff.”
Trump said that the tariffs are to force two American neighbors to escalate the fight against feentanyl trade and stop illegal immigration. But Trump also pointed out that he also wants to eliminate America’s trade imbalance and push more factories to move in the United States.
His comments quickly He rattled on the American Stock ExchangeWith the S&P 500 index, it fell by 2% on Monday afternoon. This is a sign of political and economic risk, which Trump is forced to take, taking into account the possibility of higher inflation and the possible death of the decades of trade partnership with Mexico and Canada, when the tariffs come into force at 12:01 on Tuesday.
However, Trump’s administration remains sure that tariffs are the best choice to escalate production in the US and attract foreign investment. Howard Lutnick Secretary of Trade said on Monday that Computer Chipmaker TSMC He extended his investments in the United States due to separate capabilities of 25% of tariffs.
In February, Trump put down a 10% import tariff from China. He emphasized again on Monday that he would double on Tuesday to 20%.
Trump provided a monthly delay in February, because both Mexico and Canada promised licenses. But Trump said on Monday that “there was no occurrence for Mexico or Canada” to avoid steep recent tariffs, which were also set to tax on Canadian energy products, such as oil and electricity with a lower rate of 10%.
Canada Prime Minister Justin Trudeau said on Monday that “there is no justification” for Trump’s tariffs.
“Due to the US tariffs imposed by the US, Americans will pay more for food, gas and cars and potentially lose thousands of jobs,” he said. “Tariffs will disturb the extremely successful trade relationship. They will violate the trade agreement itself negotiated by President Trump in the last term. “
Trudeau said his country would take revenge by placing a 25% tariff for American goods worth $ 155 billion in Canadians ($ 107 billion) in 21 days, starting from tariffs to $ 30 billion of Canadians ($ 21 billion) after midnight on Tuesday.
Mexico President Claudia Sheinbaum went on Monday, waiting to see what Trump would say.
“This is a decision that depends on the US government, the President of the United States,” said Sheinbaum before Trump’s statement. “So, regardless of his decision, we will make our decisions and there is a plan, there is unity in Mexico.”
Both countries tried to show actions in response to Trump’s fears. Mexico sent 10,000 soldiers of the National Guard to his common border to break down drug trafficking and illegal immigration. Canada called Fentanyl a spell, even though the drug smuggling from Canada to the United States seems relatively modest.
On Sunday it was not clear what choice Trump would make in the field of tariff rates. Lutnick said Fox News Channel “Sunday Morning Futures” that the decision was “liquid”.
“Now he thinks about how exactly he wants to play in Mexico and Canada,” said Lutnick. “And this is a smooth situation. On Tuesday in Mexico and Canada there will be tariffs. Exactly what they are, we will leave it to the president and his team to negotiate. “
Treasury Secretary Scott Bessent said that Mexico also offered 20% of taxes on all imports from China as part of talks with the United States.
Bessent said CBS News on Sunday that China “eats” tariff costs instead of transferring them to American companies and consumers who import their products in the form of higher prices.
But companies, from Ford to Walmart, warned about the negative impact that tariffs could create for their companies. Similarly, many analyzes carried out by the Peterson Institute for International Economics and Yale University Budget Lab suggests that the average family can meet with price increases by over 1000 USD.
“This will have a very destructive impact on companies when it comes to their supply chains, as well as their ability to effectively conduct business activities,” said Eswar Pragad, an economist from Cornell University. “There will be inflationary impact that will have destructive effects.”
Democratic quickly criticized the announced tariffs for deterioration of inflation and alienation of allies.
The leader of the Democratic Senate Chuck Schumer from New York said that voters in last year’s elections were primarily nervous, and “now Donald Trump would worsen.”
Senator Amy Klobuchar, D-Minn., Predicted that the cost of fertilizer would escalate for farmers in her condition.
“It’s a crazy way to deal with our allies, right? It literally reaches Russia at the same time when he imposes a 25% tariff to Canadian goods – she said.
Trump also plans to introduce in April, which he calls “mutual” tariffs that would match the rate calculated by other countries, including all subsidies and value added taxes calculated by these countries.
The US President has already announced the removal of layoffs from his tariffs for 2018 on steel and aluminum, in addition to tariffs for cars, computer chips, copper and pharmaceutical drugs.
