Trump’s tariffs on Canada, Mexico, China begin; their response follows

Photo : Reuters

The United States has raised taxes on products coming from Canada, Mexico, and China. These new trade taxes, called tariffs, started on March 4 under President Donald Trump’s rule. This has made relations between the countries tense. Canada and Mexico now have to pay 25% more to sell their goods in the US, while China has to pay 20% more, including an extra 10% increase.

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Canada quickly answered back by placing taxes on US products worth C$30 billion ($20.75 billion). The first step is to add 25% tax on these products right away. More taxes worth C$125 billion ($86.4 billion) may follow soon. Canada’s Prime Minister, Justin Trudeau, confirmed this decision. Foreign Minister Melanie Joly said the US tariffs could hurt Canada’s economy and might cause job losses.

China also responded by placing new taxes on American food and farm products. The new charges include 15% on chicken, wheat, corn, and cotton. Other items like soybeans, pork, beef, seafood, milk, fruits, and vegetables will have a 10% tax. These changes will start on March 10. The Chinese government strongly opposed these US tariffs, calling them unfair and selfish. The Chinese Embassy in Washington also said that these actions go against global trade rules.

Mexico has not yet made a decision on how to respond. President Claudia Sheinbaum said she will wait until her morning speech on Tuesday to share Mexico’s next step. However, she hinted that Mexico has different plans ready if the situation gets worse. In the past, Mexico avoided US trade taxes by strengthening security at its border and increasing efforts to stop drug trafficking. Sheinbaum assured the public that Mexico is ready and has different strategies to handle this problem.

The new trade taxes have already affected stock markets. On Monday, the value of North American stocks dropped as people worried about business problems. The Dow Jones Industrial Average fell by 649.67 points (1.48%) to 43,191.24, while the S&P 500 fell by 104.78 points (1.76%) to 5,849.72. The Nasdaq Composite had the biggest drop, losing 497.09 points (2.64%) to 18,350.19. The Mexican peso and Canadian dollar also lost value after the announcement. Chinese companies in the US also suffered, with electric car company Nio falling 8.6% and shopping platform JD.com dropping nearly 4%.

Another problem adding pressure to this issue is fentanyl, a powerful drug that has caused many deaths in the US. President Trump is increasing tariffs on fentanyl-related products from China, raising them from 10% to 20%. He said China has not done enough to stop the illegal drug trade. US health officials reported that fentanyl was responsible for 72,776 deaths in 2023. China denied these accusations, saying the US is using this issue as a way to put pressure on them. A Chinese government spokesperson warned that this conflict could damage cooperation between the two countries.

Canada has already started applying its new tariffs, China is getting ready to take action, and Mexico is thinking about its next move. Many experts worry that this trade fight could cause bigger problems for businesses and lead to higher prices. The world is now watching to see what will happen next.