President Donald Trump has frequently discussed the possibility of imposing tariffs on other countries, and this weekend, he followed through on that promise.
On Saturday, Trump signed an order imposing substantial tariffs on imports from Canada, Mexico, and China. In response, China’s commerce ministry announced it would file a complaint with the World Trade Organization and “take corresponding countermeasures,” though details were not provided.
Continue reading to learn more about the reasons behind the tariffs and how Canada and Mexico have responded.
What Are Tariffs?
Tariffs are taxes or duties imposed by a government on goods imported from other countries. When a country imports products, the government may charge a tariff to increase the price of those goods, making imported items more expensive than locally produced products.
Tariffs can be imposed for various reasons, including:
- Protecting local industries: By making imported goods more expensive, domestic products become more competitive in price.
- Raising government revenue: Tariffs generate money for the government.
- Influencing trade relations: Countries may use tariffs as a tool in trade negotiations or to punish or reward other nations for their policies.
Why Did Trump Impose Tariffs on Canada?
The Trump administration stated that the tariffs are intended to reduce the flow of drugs and undocumented immigrants into the U.S.
To implement the tariffs, Trump declared a national economic emergency through an executive order, invoking the International Emergency Economic Powers Act (IEEPA). This act allows the president to manage imports during a national emergency. The tariffs are scheduled to take effect Tuesday at 12:01 AM ET.
Trump posted a message on Truth Social on Saturday, explaining that he invoked the IEEPA “due to the major threat posed by illegal aliens and deadly drugs, including fentanyl, killing our citizens.” He emphasized that it was his duty as President to “protect Americans and ensure the safety of all.”
How Did Canada Respond to Trump’s Tariffs?
Canadian Prime Minister Justin Trudeau responded by announcing that Canada would also impose reciprocal 25% tariffs on up to $155 billion worth of U.S. imports, including items like alcohol and fruit.
Canada’s response to U.S. tariffs. Justin Trudeau’s best speech.
Canada will place 25% tariffs on $155 billion in US imports in retaliation for Trump tariffs. That is an addition to a nationwide boycott on all US products across Canada. #cdnpoli #tariffwar pic.twitter.com/VJavxmO6nH
— Anonymous (@YourAnonCentral) February 2, 2025
Canada’s retaliatory tariffs would begin Tuesday, the day U.S. tariffs on Canadian imports are scheduled to take effect.
However, on Monday, Trump said he expects another “good conversation” with Trudeau after reaching a deal with Mexico’s President Claudia Sheinbaum, which resulted in a pause on the 25% tariff for Mexico. A call between the two leaders is scheduled for 3 p.m. Eastern time.
How Did Mexico React to the Tariffs?
Mexico’s president also issued an order for retaliatory tariffs in response to the U.S. actions over the weekend. Sheinbaum took to X to reject accusations from the White House, calling them “slander” and denying any ties between the Mexican government and criminal organizations. Sheinbaum emphasized that she had instructed the country’s economy secretary to take action, including the implementation of the retaliatory tariffs and other measures to protect Mexico’s interests.
“If the United States government and its agencies wanted to address the serious fentanyl consumption in their country, they could fight the sale of drugs on the streets of their major cities, which they don’t do and the laundering of money that this illegal activity generates that has done so much harm to its population,” she added.
However, on Monday, February 3, Sheinbaum announced on social media, just 12 hours before the tariffs were set to take effect, that a deal had been made with the Trump administration to delay the tariffs. In exchange for a pause on the 25% tariffs, Sheinbaum agreed to deploy 10,000 additional troops, who President Trump said would be assigned to stop the flow of migrants and illegal drugs across the U.S.-Mexico border.
