(The Center Square) – President-elect Donald Trump’s vow to hit America’s top trading partners with 25% tariffs on imported goods prompted a cool response from neighbors and China.
Mexico’s lower house leader Ricardo Monreal, a member of the ruling Morena party, said a trade war would hurt the entire continent.
“An escalation of trade retaliation would only hurt people’s pockets, far from solving underlying problems,” he wrote on X. “This measure would cause severe damage to the economy and the population of North America.”
Trump said he plans put the tariffs in place on his first day in office and keep them in place until problems at the northern and southern border are fixed.
“As everyone is aware, thousands of people are pouring through Mexico and Canada, bringing Crime and Drugs at levels never seen before,” Trump announced on Truth Social. “On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders. This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”
Trump said Mexico and Canada “have the absolute right and power to easily solve this long simmering problem. We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!”
Trump accused China of failing to prevent smuggling of the chemicals used to make fentanyl, a powerful synthetic opioid that has fueled overdose deaths in the U.S. He singled China out for a 10% tariff. Trump previously suggested tariffs of up to 60% on Chinese imports.
“I have had many talks with China about the massive amounts of drugs, in particular Fentanyl, being sent into the United States – But to no avail,” Trump wrote on Truth Social. “Representatives of China told me that they would institute their maximum penalty, that of death, for any drug dealers caught doing this but, unfortunately, they never followed through, and drugs are pouring into our Country, mostly through Mexico, at levels never seen before. Until such time as they stop, we will be charging China an additional 10% Tariff, above any additional Tariffs, on all of their many products coming into the United States of America.”
Liu Pengyu, a spokesperson for the Chinese embassy in Washington, said a trade tiff would hurt all countries.
“No one will win a trade war or a tariff war,” he said, according to a USA Today report. “The idea of China knowingly allowing fentanyl precursors to flow into the United States runs completely counter to facts and reality.”
Trump’s proposal appears to violate the United States-Mexico-Canada Agreement, or USMCA, the trade pact between the three countries that allows for duty-free trade. Trump signed the deal into law in 2020.
Mexico’s finance ministry said: “Mexico is the United States’ top trade partner, and the USMCA provides a framework of certainty for national and international investors.”
Mexico’s president, Claudia Sheinbaum, said she will write to Trump to warn him that his pledge to impose 25% tariffs on Mexico and Canada will cause inflation and job losses in both countries.
“To one tariff will come another and so on, until we put our common businesses at risk,” Sheinbaum said at a news conference Tuesday, Reuters reported.
A Canadian government official told the BBC that Trump spoke to Canada’s Prime Minister Justin Trudeau for about 10 minutes, discussing trade and border security. The source said they had a “good discussion.” During the call, Trudeau pointed out that the number of migrants crossing the Canadian border was much smaller compared to the US-Mexico border, the official said.
Canadian officials said in a statement Tuesday that their country is committed to border security.
“Canada places the highest priority on border security and the integrity of our shared border,” Deputy Prime Minister Chrystia Freeland and Public Safety Minister Dominic Leblanc said in a joint statement. “Our relationship today is balanced and mutually beneficial, particularly for American workers.”
Tariffs could raise prices for U.S. consumers and slow economic growth. S&P Global, a credit-rating agency, reported that Trump’s proposed tariffs – a 10% across the board hike and up to 60% for China – could boost inflation by 1.8% and lower U.S. economic output by 1%, according to a post-election report.
