BS President Donald Trump has confirmed his intent to proceed with a 25% tariff on imports from Canada and Mexico, set to take effect on 1 February, while leaving the fate of oil imports from these nations undecided.
Speaking to reporters in the Oval Office, Trump stated that the tariffs aimed to curb undocumented migration and the influx of fentanyl into the United States, as well as to address trade imbalances with its neighbouring countries, reports BBC.
He also hinted at new tariffs against China, citing the opioid crisis as a justification for economic penalties.
“With China, I’m also thinking about something because they’re sending fentanyl into our country, and because of that, they’re causing us hundreds of thousands of deaths,” Trump remarked. “So China is going to end up paying a tariff also for that, and we’re in the process of doing that.”
During his election campaign, Trump had threatened tariffs of up to 60% on Chinese imports but has thus far refrained from immediate action, instead directing his administration to assess the matter.
US imports from China have largely stagnated since 2018, an outcome economists attribute to the successive tariffs imposed during Trump’s first term.
China, meanwhile, has called for a "win-win" approach to trade relations. Speaking at the World Economic Forum in Davos earlier this month, Vice Premier Ding Xuexiang urged against protectionist measures and expressed Beijing’s intent to expand imports. However, he refrained from directly naming the United States.
Canada and Mexico have indicated that they will retaliate with countermeasures should the tariffs come into force, while simultaneously reassuring Washington of their efforts to address border concerns.
If oil imports from these nations are subjected to levies, it could contradict Trump’s pledge to reduce the cost of living, as nearly 40% of the crude refined in the United States is imported, the majority of it from Canada.
While tariffs are designed to incentivise domestic production by making foreign goods more expensive, the costs are often passed on to businesses and consumers. Increased import levies on energy resources may lead to rising prices across essential goods, from petrol to groceries, further straining American households.
