Trump Says That Tariffs on Canada and Mexico Will Take Effect Next Week

 

On Monday, U.S. President Donald Trump confirmed that the tariffs he has threatened to impose on all goods from Mexico and Canada will go into effect once a one-month negotiated pause expires. 

"The tariffs are going forward on time, on schedule," he told reporters in a press conference with French President Emanuel Macron at the White House. "We've been mistreated very badly by many countries, and that includes Canada and Mexico. . . . All we want is reciprocal, we want reciprocity. We want the same, so if somebody charges us, we charge them." 

Early this month, Trump threatened to revise the tariff rates on Mexico and Canada upwards to 25 percent (except for Canadian energy, which would be subject to a 10 percent levy). After securing border-related concessions from both nations, Trump agreed to pause the tariff hike for a month for negotiations. If the tariffs do go into effect as he forecast, they will begin to affect cross-border trade on March 4. 

Canada is preparing to retaliate with its own tariffs on a list of $110 billion worth of U.S. goods. "The threat of tariffs is a real one and may continue for a while. We need to be able to deal with the unpredictability of President Trump," said Foreign Affairs Minister Mélanie Joly, speaking to reporters in London on Monday. 

If fully implemented, an across-the-board tariff schedule of 25 percent for Canadian and Mexican goods would have significant economic effects. Economists predict that Mexico and Canada would likely enter a recession; U.S. GDP would be reduced by about 0.5 percent compared with business as usual; and inflation would increase in all three countries. Mexico, as the largest exporter of goods to the United States - larger than Canada or China - would be especially hard-hit.