Mexico, Canada respond to Donald Trump’s tariff pledge

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Mexico is currently the United States’ top trade partner, representing 15.8 per cent of total trade, followed by Canada at 13.9 per cent.

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But Trump made it clear during his election campaign that he would readily use tariffs as leverage to tackle the tide of illegal immigrants coming into America.

After Trump’s social media post, Canadian Prime Minister Justin Trudeau spoke to the president-elect as he sought to tamp down concerns about the potential impact on his country’s economy.

Trevor Tombe, an economist who authored a report on the consequences of US tariffs on Canada’s economy, warned a recession was likely if Trump followed through on the 25 per cent tariff.

The country’s premiers have warned a trade war would cause immense damage to their respective economies, while the Canadian dollar fell to its lowest level since May 2020.

Trudeau, who has called an emergency meeting with worried provincial premiers for Wednesday (Thursday AEDT), told reporters he had a “good call” with Trump.

Then-president Donald Trump and Canadian Prime Minister Justin Trudeau in 2019. Credit: AP

“We obviously talked about laying out the facts, talking about how the intense and effective connections between our two countries flow back and forth,” he said.

“This is a relationship that we know takes a certain amount of working on, and that’s what we’ll do.”

In an echo of Trump’s politics, Trudeau initiated a U-turn on immigration, restricting flows of new migrants. He said last week Canada’s system had been exploited by “bad actors”.

Trump’s vision for tariff hikes on Mexico, Canada and China were laid out in a Truth Social post on Monday night.

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“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,” he said.

In a follow-up post, he also announced that the US “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”.

The reason, he said, was China’s failure to curb the number of drugs entering the US. China is a major producer of precursor chemicals that are acquired by Mexican drug cartels and others to manufacture fentanyl, a synthetic opioid that accounts for about 70 per cent of all drug overdoses in the US.

“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,” Trump said.

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