Donald Trump has announced plans to impose new tariffs on China, Mexico, and Canada on his first day in office, aiming to pressure these nations to curb illegal immigration and drug smuggling into the United States.
Trump stated that immediately following his inauguration on January 20, he would sign an executive order imposing a 25% tariff on all goods coming from Mexico and Canada.
He revealed that a 10% tariff would be applied to Chinese goods until Beijing takes action to stop the smuggling of fentanyl, a synthetic opioid, into the U.S.
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If carried out, these measures would represent a significant escalation in trade tensions with America’s top three trading partners.
Trump emphasized that the tariffs on Mexico and Canada would remain in place until both countries take more decisive steps to combat drug trafficking, especially fentanyl, and illegal immigration.
In a post on his Truth Social platform, he stated, “Both Mexico and Canada have the absolute right and power to easily solve this long-simmering problem. It is time for them to pay a very big price!”
In another post, Trump criticized China for not following through on promises to impose the death penalty for those caught trafficking fentanyl.
A spokesperson for the Chinese embassy in Washington rejected Trump’s claims, stating that “the idea of China knowingly allowing fentanyl precursors to flow into the United States runs completely counter to facts and reality.”
The spokesperson added that China views its economic relationship with the U.S. as mutually beneficial and warned that no one benefits from a trade war.
The Biden administration has urged China to take stronger measures to stop the production of fentanyl, which is linked to nearly 75,000 deaths in the U.S. last year.
During his campaign, Trump threatened tariffs of up to 100% on Mexico and China if he deemed them necessary—much higher than those imposed during his first term. He also promised to revoke China’s most-favoured-nation trading status, which grants the country the best trade terms with the U.S.
Tariffs have been central to Trump’s economic vision, which he sees as a tool to stimulate the U.S. economy, protect American jobs, and generate tax revenue.
He has repeatedly claimed that these tariffs would not burden American consumers but instead shift costs to the countries being taxed, a claim widely disputed by economists.
Stephen Roach, Senior Fellow at the Paul Tsai China Centre of Yale Law School, explained that Trump’s approach is consistent with his campaign promises to use tariffs as leverage for achieving policy goals.
Scott Bessent, Trump’s pick for Treasury Secretary, previously suggested that the president-elect’s tariff threats were part of a broader negotiation strategy: “It’s escalate to de-escalate.”
The proposed tariffs come at a time when China’s economy is facing significant challenges, including a property market crisis, weak domestic demand, and rising local government debt.
The new tariffs could violate the US-Mexico-Canada Agreement (USMCA), the trade deal Trump signed into law in 2020, which created a largely duty-free trading relationship between the three countries.
After Trump’s announcement, he reportedly discussed trade and border security issues with Canadian Prime Minister Justin Trudeau, while Mexico’s finance ministry emphasized that the USMCA provides a framework of stability for international trade and investment.
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