FILE PHOTO: A truck drives past Cosco and China Shipping shipping containers in the Port of Miami in Miami, Florida, US, May 19, 2016. [Photo/Agencies]
US President Donald Trump has confirmed plans to enact an additional 10 percent tariff on products from China and 25 percent on those from Canada and Mexico starting next month after he accused China of sending fentanyl to the two countries, saying it ends up in the United States.
The tariffs on all three countries — key trading partners of the US — will begin on Feb 1, the president announced on his first day back in office. He squarely blamed Canada and Mexico for allowing "mass numbers of people and fentanyl" to come into the US.
He told reporters on Monday in the Oval Office that he "may" impose a universal tariff on all imports because "essentially all countries take advantage of the US." He announced the new levies on Tuesday.
The tariffs are predicted to impact the global supply chain, as Mexico, China and Canada account for a third of the trade in goods with the US.
Altogether, the three countries purchased more than $1 trillion of goods from the US and sent $1.5 trillion in exports to the US in 2023, US government data shows.
In 2023, of nearly $4 trillion in US imports from international sources, $448 billion was from China, according to US Census Bureau data. That was down $109.1 billion from 2022, when the US imported $536.3 billion in goods from China.
Trump positioned tariffs as one of his first priorities in office in his inauguration speech after he was sworn in as the 47th US president on Monday inside the Capitol building in Washington D.C.
The president declared that he wants to "tariff and tax" foreign countries to "enrich our citizens" and overhaul the trade system in his second term. His aim is to lessen illegal drugs and migrants flowing into the US.
He also vowed to establish an External Revenue Service to collect the proposed tariffs and has created the Department of Government Efficiency, or DOGE, led by billionaire Tesla CEO Elon Musk.
"I will work immediately to begin the overhaul of our trade system to protect American workers and families," Trump said in his inaugural address. "Instead of taxing citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens.
"We are establishing the External Revenue Service to collect all tariffs, duties and revenues," he added. "It will be massive amounts of money pouring into our Treasury, coming from foreign sources. The American dream will soon be back and thriving like never before."
It is expected that the countries targeted with tariffs could retaliate with their own levies on US goods.
Mexico and Canada have already tightened their borders in an attempt to stop illicit drugs and migrants.
Mao Ning, a spokeswoman for China’s Foreign Ministry, expressed China’s willingness to address the two countries’ differences at a news conference in Beijing on Wednesday.
She said: "We always believe there is no winner in a tariff or trade war. We will always firmly safeguard our national interests."
Trump will instruct federal agencies to investigate trade deficits, what he called unfair currency deals, counterfeit goods and the "de-minimis" rule that allows goods to flow into the US without being subject to duties or taxes if valued at under $800. They will report back by April 1.
Economists, business leaders and think tanks have said repeatedly that tariffs will raise costs for businesses and hurt American consumers and do not guarantee domestic jobs.
