US stock markets tumbled after President Donald Trump confirmed he would proceed with a 25% tariff on goods imported from Canada and Mexico, citing a failure to reach an agreement. The tariffs, long threatened, will take effect on Tuesday.
Trump also announced an additional 10% tariff on Chinese imports, escalating trade tensions with all three of America's largest trade partners. "There's no room left for Mexico or Canada," he stated at the White House. "The tariffs are set—they take effect tomorrow."
Canada swiftly vowed retaliation, with Foreign Minister Mélanie Joly declaring, "If Trump imposes tariffs, we are ready." Ottawa plans to levy duties on $155 billion worth of US goods, including $30 billion in immediate tariffs on essential products like pasta, clothing, and perfume. Joly emphasized that while Canada seeks to avoid a trade war, it will respond decisively if provoked.
Mexico and China have also signaled plans for countermeasures, raising fears of escalating economic conflict. Trump's justification for the tariffs includes concerns over illegal drugs and immigration, though Canada and Mexico had previously negotiated a temporary reprieve. Meanwhile, China has already been subjected to a 10% tariff since February, bringing the total duty on its exports to the US to at least 20%.
Despite concerns over potential economic repercussions, Trump defended the move, arguing that tariffs help correct trade imbalances and protect American industries. He dismissed warnings about economic fallout, insisting that companies could avoid tariffs by relocating manufacturing to the US.
Following Trump's remarks, Wall Street reacted negatively. The Dow Jones fell 1.4%, the S&P 500 dropped 1.75%, and the Nasdaq declined 2.6%.
With officials from Canada and Mexico recently engaging in last-minute negotiations in Washington, both countries have reiterated their commitment to defending their economies. Meanwhile, China is expected to target US agricultural and food exports in its response.
Trump has also confirmed a 25% tariff on all steel and aluminum imports starting March 12, further escalating trade tensions globally.
Source: BBC
BDST: 0852 HRS, MAR 04, 2025
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