The United States has delayed implementing planned 25 percent tariffs on Canadian and Mexican imports by one month after last-minute discussions between President Donald Trump and the leaders of Canada and Mexico on Monday. Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum agreed to enhance border security to prevent drug and migrant trafficking into the US, preventing a potential trade war. However, the 10 percent tariffs on Chinese goods went into effect on Tuesday, prompting retaliatory actions from Beijing. The US has previously imposed tariffs on Chinese goods during Trump’s first term from 2017 to 2021, leading to global market turmoil. The value of goods traded between the US and the world from January to November 2024 totaled $4.88 trillion, with $2.98 trillion in exports and $1.90 trillion in imports. Mexico, Canada, and China are the top trading partners of the US, accounting for over 40 percent of total goods traded, valued at more than $2 trillion. Tariffs are government-imposed taxes on imported goods and services, designed to protect domestic industries by making foreign products more expensive, potentially impacting consumer demand. The pause on tariffs in Canada and Mexico follows commitments from both countries to enhance border security measures, as announced after talks with President Trump. The US has also imposed tariffs on various goods from China, leading to a trade war. Tariffs are used to protect domestic industries from foreign competition by increasing the prices of imported goods, but they can also lead to higher costs for consumers. Trump’s motivation for imposing tariffs includes addressing issues such as undocumented migrants, drug trafficking, and intellectual property theft, as well as to boost domestic manufacturing and generate revenue for public spending. The products affected by tariffs include cars, fuel, computers, electrical equipment, and food items like avocados. Retaliatory tariffs have been threatened by Canada, Mexico, and China in response to US tariffs. China has criticized the tariffs and plans to challenge them at the WTO. The US has imposed tariffs on China under Section 301 of the Trade Act of 1974, leading to a trade war between the two countries. The potential for a trade war remains as tariffs against China are set to take effect, with the possibility of additional tariffs against other countries.
