Former President Donald Trump has announced plans to impose new tariffs on China, Mexico, and Canada on his first day back in office if he wins the presidency in 2024.
According to Trump, the measures aim to combat illegal immigration and drug smuggling, marking a sharp escalation in trade tensions with three of the United States’ largest trading partners.
Trump said he would sign an executive order immediately after his inauguration on January 20 to implement a 25% tariff on all goods imported from Mexico and Canada.
Additionally, he plans to impose a 10% tariff on goods from China until Beijing takes more decisive action to curb the export of the synthetic opioid fentanyl to the United States.
If enacted, these tariffs could cause significant disruptions to global supply chains while placing economic strain on Mexico, Canada, and China.
Trump has said that the tariffs targeting Mexico and Canada will remain in place until both nations address the issues of illegal immigration and drug smuggling, particularly fentanyl. “Both Mexico and Canada have the absolute right and power to solve this long-simmering problem easily,” Trump wrote on his Truth Social platform. “It is time for them to pay a huge price!”
In a separate statement, Trump criticised China for failing to follow through on what he claimed were promises to impose the death penalty on fentanyl traffickers.
A spokesperson for the Chinese embassy in Washington dismissed the accusations, arguing that claims of China knowingly allowing fentanyl precursors to flow into the U.S. are “contrary to facts and reality.” The spokesperson added, “China believes China-US economic and trade cooperation is mutually beneficial. No one will win a trade war or a tariff war.”
Trump’s announcement reflects his long-held economic stance, which he argues protects American jobs, grows the economy, and generates tax revenue.
However, many economists have challenged his assertion that tariffs exclusively burden other countries, calling this view misleading. Stephen Roach, a senior fellow at Yale Law School’s Paul Tsai China Center, said the plan aligns with Trump’s campaign rhetoric. “It’s consistent with his campaign promise to use tariffs to achieve broader policy goals,” he remarked.
Trump’s approach to tariffs has also been described as part of a negotiation strategy. Scott Bessent, Trump’s pick for Treasury Secretary, previously characterized the former president as a free trader, saying, “My general view is that at the end of the day, he’s a free trader,” while describing his methods as “escalate to de-escalate.”
Critics have pointed out that the proposed tariffs may violate the terms of the US-Mexico-Canada Agreement (USMCA), which was signed into law by Trump in 2020.
The agreement was designed to maintain a duty-free trading relationship between the three countries. Following Trump’s remarks, Mexico’s finance ministry underscored the importance of the USMCA, noting, “Mexico is the United States’ top trade partner, and the USMCA provides a framework of certainty for national and international investors.”
Both Mexico and Canada are heavily dependent on the U.S. as their largest export market, with over 80% of Mexico’s exports and 75% of Canada’s exports destined for the U.S. At the same time, the U.S. remains a crucial market for China, accounting for about 15% of its exports.
Analysts note that China’s economy is more vulnerable than during Trump’s previous presidency due to ongoing challenges such as a property market crisis, weak domestic demand, and rising local government debt.
In addition to tariffs, Trump has proposed ending China’s most-favored-nation trading status with the U.S., which currently provides the country with preferential terms on tariffs and trade restrictions. During his first term, Trump frequently used tariffs as a central element of his economic policy, sparking trade disputes with key partners.
While some observers believe Trump’s latest tariff threats could be part of his negotiating strategy, others warn of the risks to global trade stability and diplomatic relations. As Trump places tariffs at the heart of his 2024 campaign, the potential impacts on international trade agreements and global markets remain a subject of intense debate.
