US President Donald Trump's new 25 percent tariffs on imports from Mexico and Canada took effect today, along with a doubling of duties on Chinese goods to 20 percent, launching new trade conflicts with the top three US trading partners.
The tariff actions, which could upend nearly US$2.2 trillion in two-way annual US trade, went live at 12:01am, hours after Trump declared that all three countries had failed to do enough to stem the flow of the deadly fentanyl opioid and its precursor chemicals into the US.
Photo: Getty Images via AFP
China responded immediately after the deadline, announcing additional tariffs of 10 to 15 percent on certain US imports from Monday next week and a series of new export restrictions for designated US entities.
Canada and Mexico, which have enjoyed a virtually tariff-free trading relationship with the US for three decades, were poised to immediately retaliate against their longtime ally.
Canadian Prime Minister Justin Trudeau said that Ottawa would respond with immediate 25 percent tariffs on C$30 billion (US$20.7 billion) worth of US imports, and another C$125 billion if Trump's tariffs were still in place in 21 days.
He said previously that Canada would target US beer, wine, bourbon, home appliances and Florida orange juice.
"Tariffs will disrupt an incredibly successful trading relationship," Trudeau said, adding that they would violate the US-Mexico-Canada free trade agreement signed by Trump during his first term.
Ontario Premier Doug Ford told NBC that he was ready to cut off shipments of nickel and transmission of electricity from his province to the US in retaliation.
Mexican President Claudia Sheinbaum was expected to announce her response during a morning news conference in Mexico City today, the country's economy ministry said.
The extra 10 percent duty on Chinese goods adds to a 10 percent tariff imposed by Trump on Feb. 4 to punish Beijing over the US fentanyl overdose crisis.
The cumulative 20 percent duty also comes on top of tariffs of up to 25 percent imposed by Trump during his first term on about US$370 billion worth of US imports.
Some of these products saw US tariffs increase sharply under former US president Joe Biden last year, including a doubling of duties on Chinese semiconductors to 50 percent and a quadrupling of tariffs on Chinese electric vehicles to more than 100 percent.
The 20 percent tariff is to apply to several major US consumer electronics imports from China previously untouched by prior duties, including smartphones, laptops, videogame consoles, smartwatches, speakers and Bluetooth devices.
China's new tariffs announced today targeted a wide range of US agricultural products including certain meats, grains, cotton, fruit, vegetables and dairy products.
Beijing also placed 25 US firms under export and investment restrictions on national security grounds.
Ten of these firms were targeted for selling arms to Taiwan.
China's commerce ministry said the US tariffs violated WTO rules and "undermine the basis for economic and trade cooperation between China and the US."
US farmers were hard hit by Trump's first-term trade wars, which cost them about US$27 billion in lost export sales and conceded share of the Chinese market to Brazil.
The tariffs on Mexican and Canadian products could have much deeper repercussions for a highly integrated North American economy that depends on cross-border shipments to build cars and machinery, refine energy and process agricultural goods.
"Today's reckless decision by the US administration is forcing Canada and the US toward recessions, job losses and economic disaster," Canadian Chamber of Commerce CEO Candace Laing said in a statement.
She said the US tariffs would fail to usher in a "golden age" coveted by Trump, but instead raise costs for consumers and producers and disrupt supply chains.
"Tariffs are a tax on the American people," she said.
Trump has maintained a blistering pace of tariff actions since taking office in January, including fully restored 25 percent tariffs on steel and aluminum imports that take effect on Wednesday next week, rescinding prior exemptions.
Trump's "America First" agenda, aimed at redrawing trade relationships in favor of the US, is expected to be a centerpiece of his address tonight to a joint session of Congress.
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