Washington, D.C. – President Donald Trump and Canadian Prime Minister Justin Trudeau have reached a temporary agreement to suspend 25% tariffs on each other’s imports for 30 days, allowing time to finalize a border security pact, the leaders announced Monday evening.
The deal follows two phone calls between Trump, 78, and Trudeau, 53, earlier in the day. As part of the agreement, Canada will deploy 10,000 troops to its northern border and take additional measures to combat fentanyl smuggling into the United States.
Trump: “Securing the Northern Border”
Trump announced the deal on Truth Social, emphasizing Canada’s commitment to securing the border and tackling the fentanyl crisis.
“Canada has agreed to ensure we have a secure Northern Border and to finally end the deadly scourge of drugs like fentanyl that have been pouring into our country,” Trump wrote. “Canada will implement their $1.3 billion border plan.”
He added that protecting Americans is his “responsibility” and said he was “very pleased with this initial outcome.”
Trudeau Commits to Border Reinforcements
In a post on X (formerly Twitter), Trudeau confirmed Canada would proceed with its $1.3 billion border security initiative, first announced in December.
“Nearly 10,000 frontline personnel are and will be working on protecting the border,” Trudeau wrote.
The initiative includes:
- New helicopters, technology, and personnel to reinforce the border
- Enhanced coordination with U.S. authorities
- Increased resources to stop fentanyl smuggling
Additionally, Canada pledged to appoint a “Fentanyl Czar”, classify cartels as terrorist organizations, and establish a Canada-U.S. Joint Strike Force to combat organized crime and money laundering. Trudeau also announced a $200 million intelligence directive to support these efforts.
Similar Tariff Pause with Mexico
Earlier Monday, Trump and Mexican President Claudia Sheinbaum agreed to a similar 30-day delay in imposing tariffs on Mexico. Under that deal, Mexico will deploy 10,000 troops to its northern border, and the U.S. will help crack down on illegal arms trafficking into Mexico.
Tariff Threats and Economic Impact
Trump initially threatened tariffs on Canada and Mexico last November, demanding stronger action on fentanyl smuggling and illegal immigration. The tariffs—set to take effect at 12:01 a.m. Tuesday—would have been devastating for Canada, given that 75% of its exports go to the United States.
Had the tariffs taken effect:
- U.S. GDP could have dropped by 0.4 percentage points
- 344,000 jobs could have been lost
- American households would have faced an average tax hike of $830
Trump acknowledged the economic impact but remained firm on his stance, writing on Truth Social:
“Will there be some pain? Yes, maybe (and maybe not!). But we will make America great again, and it will all be worth the price that must be paid.”
Political Ramifications
Trudeau’s response to Trump’s threats has drawn criticism at home. Shortly after Trump’s November warning, Trudeau traveled to Mar-a-Lago to meet with the then-incoming president— a move seen by critics as a sign of weakness.
Trudeau has since announced plans to step down as leader of Canada’s Liberal Party in March, ahead of Canada’s federal elections in October.
Future Trade Tensions
While the tariff pause provides temporary relief, Trump has hinted at further trade confrontations, including possible levies on European countries and the United Kingdom.
With border negotiations ongoing, the 30-day reprieve gives both nations time to negotiate a permanent trade and security agreement, though uncertainties remain over the long-term economic and political implications.
