Donald Trump announces tariffs on goods from China, Mexico and Canada

US President-elect Donald Trump wants to impose high import tariffs on all goods from Mexico and Canada as well as additional tariffs on goods from China on his first day in office. This will be one of his first orders on January 20th, Trump said on the platform he co-founded, Truth Social.

Tariffs of 25 percent will apply to goods from Mexico and Canada. The US President-elect justified this with immigrants who bring crime and drugs into the US across these two borders. Until that stops, the tariffs should remain in effect. Both Canada and Mexico have the power to solve the problem. “We’re calling on them to use their power, and unless they do that, it’s time for them to pay a very heavy price,” Trump said.

Additional tariffs of ten percent will apply to goods from China. Trump also justified this by saying that drugs such as the deadly fentanyl were coming from the country into the USA. Although China announced that it would take action against it, it did not do so. The current US President Joe Biden met China’s head of state Xi Jinping on the sidelines of the Asia-Pacific Economic Community (APEC) summit in the Peruvian capital Lima just over a week ago. Xi had assured Biden there that he also wanted to work with the future US government under Trump.

A spokesman for the Chinese embassy in Washington warned of the consequences of a trade conflict in response to Trump’s announcement. “No one will win a trade war or a tariff war,” wrote Liu Pengyu on the X platform. The economic and trade cooperation between China and the US is mutually beneficial. There has also been progress in both countries’ fight against the drug fentanyl.

In a statement distributed on Platform X, the Canadian government emphasized the close interconnection of the two economies. It is a “balanced and mutually beneficial relationship.” Canada buys more goods from the US than from China, Japan, France and the UK combined. In addition, around 60 percent of US oil imports come from Canada, it said. The security and integrity of the shared border is Canada’s top priority.

The New York Times reported that Canadian Prime Minister Justin Trudeau spoke with the president-elect about trade relations and border security immediately after Trump’s announcement.

Trump had already announced far-reaching tariffs during the election campaign. Tariffs are a type of surcharge on imported goods. They are due at the border when a company or consumer in the US purchases the product from abroad. Trump argues that his tariff policy will lead to US companies producing more in the US again. That creates jobs. It is the classic “America First” policy that the Republican pursued during his first term in office.

The Democratic US President Biden has also relied on protectionism. He not only largely retained Trump’s China tariffs, but also imposed new tariffs – for example on electric cars. While Biden focused relatively specifically on specific industries, the tariffs announced by Trump are more far-reaching.

Many experts fear that this isolation policy will lead to higher prices. Because many goods from abroad cannot be produced in the USA overnight. Companies are therefore still dependent on imports from abroad for production – import duties then increase the costs for these goods. Companies are expected to simply pass these costs on to consumers. In addition, countries affected by the tariffs are likely to respond with counter-tariffs – which in turn is bad for US companies that export a lot.

Washington and Beijing have been embroiled in a trade conflict for years. Biden left in place tariffs against China that Trump had imposed. The US also imposed economic sanctions and export restrictions to make it more difficult for Beijing to access US technologies. Biden’s administration also introduced restrictions on US investment in China. Biden also initiated large-scale investments at home to make America’s supply chains more independent – especially from China. However, both countries are closely intertwined economically.

Trump also imposed tariffs on certain products from Mexico and Canada, such as steel and aluminum, during his first term in office. He repeatedly argued with the two countries about tariffs and set various conditions in order to avert punitive tariffs.

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