President-elect , Donald Trump , vowed more taxes on , China , as also as , U. S.  , neighbors , Canada , and , Mexico, providing a strong shop to expectations that he might anger his business policies during a subsequent name.
Trump said he would impose additional 10 % tariffs on goods from , China , and 25 % tariffs on all products from , Mexico , and , Canada , in posts to his Truth Social network on Monday that sent the dollar higher and equities lower.
He argued that the new taxes were necessary to stop illegal immigration and crossing edges. Trump accused , China , of failing to follow through on pledges to center the death penalty for criminals of fentanyl, writing that “drugs are pouring into our Land, generally through , Mexico, at degrees never seen before”.
” Until such time as they stop, we will be charging , China , an extra 10 % Price, above any more Taxes, on all of their many merchandise coming into , the United States , of America”, Trump said.
In another post, the incoming president also vowed to hit , Mexico , and , Canada , with a 25 % tariff on” ALL products”, saying he would sign an executive order to that effect on his first day in office.
” As everyone is conscious, thousands of people are pouring through , Mexico , and , Canada, bringing Violence and Pharmaceuticals at degrees never seen before”, he said. This price will continue in effect until Fentanyl and all other illegal aliens quit this country’s invasion, according to the law.
While public health experts say fentanyl overdoses remain a major issue, provisional data released earlier this month by the , Centers for Disease Control and Prevention , showed a 14 % drop in drug overdose deaths from , June 2023 , to , June 2024.
Despite business leaders ‘ concerns about the impact of Trump’s tax threats, the approaching president’s rhetoric about using business levies to carry out his policy objectives is highlighted by his tariff threats. And it came just weeks after he tapped , Scott Bessent , to be the next director of the , U. S.  , Treasury, a shift that was seen as a promising sign for those seeking a more measured tax position.
The announcement caused the American dollars to fall to its lowest level in four years, and the peso’s price was near to its weakest since 2022. China’s renminbi edged lower onshore.
Representatives for Canadian Finance Minister , Chrystia Freeland , and the , Mexican Foreign Affairs Ministry , and , Economy Ministry , did n’t immediately respond to requests to comment. Trump’s spokespeople did n’t respond to a question regarding potential exemptions from the duties right away.
Trump campaigned on commitments to implement sweeping tariffs on friends and enemies alike, vowing to hike taxes to 60 % for all products imported from , China , and to 20 % for those brought in from the rest of the world — policies he says will help force companies to re-shore manufacturing jobs in the , U. S.  , and raise revenue for the federal government.
Ripple Effects
The Republican has long said he favors tariffs as a negotiating tool, even with , U. S.  , partners, and during the presidential campaign in 2024, he mused about replacing the federal income tax with revenue from trade levies. However, the majority of mainstream economists cautioned against Trump’s levies raising consumer prices, reversing inflation, and reversing or reducing trade flows.
Higher tariffs in North America would harm the three highly integrated economies ‘ auto and consumer sectors, including food.
A 25 % tariff applied to all imports from , Canada , would put pressure on energy costs. Oil, gas and other energy products are Canada’s largest export to its southern neighbor, it’s by far the largest external supplier of crude to the , U. S.  , Wilbur Ross, Trump’s former commerce secretary, said earlier this month it would make no sense to place tariffs on Canadian energy, because” all it would do would be to raise our costs and not help anything with more American jobs”.
The tariff would also do great damage to Mexico’s auto sector and to factories in central and northern states that export electronics, plastics and other manufactured goods to , U. S.  , consumers. Trade between the two countries has grown in recent years, with , Mexico , turning into , the United States’ , largest trading partner. According to the Mexican government, global trade between the countries amounts to$ 800 billion annually.
” Tariff talk raises global inflation fears, creates concerns around global growth and increases geopolitical uncertainty”, said , Andrew Ticehurst, a senior rates strategist at , Nomura Holdings Inc.  , in , Sydney. ” The knee-jerk reaction in markets is a stronger dollar, higher yields and weaker equities”.
The move on , Mexico , and , Canada , would reignite a trade feud that simmered across the continental bloc during Trump’s first term, where he forced a renegotiation of the North American Free Trade Agreement and imposed tariffs on certain sectors, including steel.
Currently, the re-branded trade pact, known as , the United States-Mexico-Canada Agreement, allows for duty-free trade across a wide range of sectors. It’s not clear what recourse American importers, who would pay the duties, would have under the pact to head off any levy.
Economic Team
Beyond Bessent, Trump still has a number of top economic roles to fill in his administration. One of the chief architects of Trump’s tariff agenda, former , U. S.  , Trade Representative , Robert Lighthizer , has yet to land a role in the second term.
Trump has also vowed to move quickly to secure the , U. S.  , border — one of the top issues for voters in November’s presidential election — following a surge in migrants that taxed communities across the country and became a major political liability for President , Joe Biden , and Vice President , Kamala Harris, the Democratic nominee.
The president-elect says he will carry out the largest mass deportation of undocumented migrants and finish building the wall on the , U. S. Mexico , border that he started during his first administration. He has also confirmed his intention to use the , U. S.  , military to carry out the deportations.
Trump’s team has been taking shape with him selecting , South Dakota , Gov.  , Kristi Noem , to lead the , Department of Homeland Security , and , Tom Homan, the former acting head of the , U. S. Immigration and Customs Enforcement , agency, to serve as his border czar.
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