US President Donald Trump has announced sweeping new tariffs on all goods imported from America’s three largest trading partners, China, Mexico and Canada.
Trump said the US would impose tariffs of 25% on Canada and Mexico, and 10% on China. Canadian energy faces a lower 10% tariff.
He had threatened to impose the import taxes if the three countries did not address his concerns about illegal immigration and drug trafficking.
Together, the trio accounted for more than 40% of imports into the US last year.
“Today’s tariff announcement is necessary to hold China, Mexico, and Canada accountable for their promises to halt the flood of poisonous drugs into the United States,” the White House said in a statement on X on Saturday.
Trump posted on his Truth Social platform: “This was done through the International Emergency Economic Powers Act (IEEPA) because of the major threat of illegal aliens and deadly drugs killing our Citizens, including fentanyl.”
In practical terms, a tariff is a domestic tax levied on goods as they enter the country, proportional to the value of the import.
China has warned against protectionism as Trump’s return to the presidency renews the threat of a trade war between the world’s two biggest economies.
China’s vice-premier Ding Xuexiang told the World Economic Forum in Davos, Switzerland, last month that his country was looking for a “win-win” solution to trade tensions and wanted to expand its imports.
Canada and Mexico have said that they would respond to US tariffs on their goods with measures of their own, while also seeking to assure Washington that they were taking action to address concerns about their US borders.
In a bid to avoid the tariffs altogether, Ottawa had promised to implement C$1.3bn ($900m; £700m) of new security measures along its US border.
Canadian Prime Minister Justin Trudeau is to address the media on Saturday evening.
Tariffs on Canada come into effect on Tuesday.
The Canadian Chamber of Commerce released a statement ahead of what it called Trump’s “profoundly disturbing decision” on tariffs.
The tariffs will have “immediate and direct consequences on Canadian and American livelihoods” and will “drastically increase the cost of everything for everyone”, it said.
Explaining why it was targeting its top trading partners, the White House said Mexican cartels were responsible for trafficking fentanyl, methamphetamine, and other drugs.
It said tariffs on Canada would remain until it “cooperates with the US against drug traffickers and on border security”.
Lastly, it said “China plays the central role in the fentanyl crisis” with exports of the lethal synthetic painkiller.
