Canada, Mexico outrage grows alongside trade war fears
- Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum have held a call to discuss strengthening ties and economic cooperation in the face of Trump’s tariff move, which has drawn global condemnation.
- The Trump administration plans to impose levies of 25 percent on goods from Canada, and 10 percent on energy products from the country starting from Tuesday. Goods from Mexico will be subject to tariffs of 25 percent, while imports from China face 10 percent.
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Canada announces mechanism for businesses to seek relief from US tariffs
Canadian officials say they’ll provide a way for local businesses to obtain financial relief from retaliatory tariffs set to take effect against the US in the coming days.
“We want to preserve this relationship, but in the face of the unjustified US tariffs against Canadian goods, we are taking action to protect our economy, our workers and our businesses. We will always stand for Canada,” said Dominic LeBlanc, Canada’s finance minister, in a statement.
Under the so-called “remission process”, Canadian businesses could apply for tariff relief or refunds, provided they meet certain conditions. Companies would be eligible for the relief if goods cannot be sourced domestically or reasonably from non-US sources.
The government would also consider relief on a case-by-case basis in “other exceptional circumstances that could have severe adverse impacts on the Canadian economy”, LeBlanc’s statement said.
What are retaliatory tariffs?
A retaliatory tariff is a duty or tax that a country slaps on imports from another nation in response to tariffs imposed by the first. It is a way for countries to retaliate against trade practices they view as damaging to their economies.
Following Trump’s announcement of steep tariffs on Mexico and Canada, Mexican President Claudia Sheinbaum immediately ordered retaliatory tariffs and Canadian Prime Minister Justin Trudeau said he would put matching 25 percent tariffs on up to $105bn of US imports.
During Trump’s first term, China imposed tariffs
‘We will win’: How will Mexico respond to Trump’s tariffs?
The United States is by far Mexico’s most important foreign market, and Mexico in 2023 overtook China as the top destination for US exports.
Mexico has been preparing possible tariffs on imports from the US, ranging from 5 percent to 20 percent, on pork, cheese, fresh produce, manufactured steel and aluminium.
Economy Minister Marcelo Ebrard said on X that Trump’s tariffs were a “flagrant violation” of the US-Mexico-Canada Agreement, noting “Plan B is under way. We will win!”
US exports to Mexico accounted for more than $322bn in 2023, Census Bureau data showed, while the US imported more than $475bn worth of Mexican products.
of up to 25 percent on more than 120 American products – including pork, fruits, nuts and wine – in retaliation for Trump‘s decision to raise duties on Chinese imports.
China said the decision, which affects about $3bn worth of imports from the US, is aimed at safeguarding its interests and balancing losses caused by tariffs imposed by Trump.
