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08-03-2025
WASHINGTON: Some of the sweeping tariffs imposed on Mexican and Canadian goods imported to the United States will be suspended until next month, President Donald Trump says
The one-month exemption includes goods covered under the USMCA trade agreement negotiated during Trump’s first term
The US enacted sweeping 25% tariffs on its North American neighbors earlier this week after previously delaying them for a month
Earlier, Canadian Prime Minister Justin Trudeau says a recent call with Trump was “colorful”, adding that Ottawa “will continue to be in a trade war… for the foreseeable future”
US Treasury Secretary Scott Bessent, meanwhile, calls Trudeau a “numbskull” and warns his approach on tariffs could lead to them being raised
Trump has said he wants to use tariffs to protect US jobs and manufacturing, and to prevent illegal migration and drug trafficking
One of the biggest questions thrown up by this latest postponement on tariffs is whether it is merely another temporary stay of execution, or if it could lead to a more permanent cancellation of the threat.
On the one hand, Trump is unlikely to relinquish a tool he considers extremely effective, even if economists question the wisdom of that policy. At the very least, his supporters claim, threatening tariffs helps to bring people to the negotiating table on issues they might otherwise have been happy to ignore.
However, he runs a danger of becoming the boy who cried wolf on tariffs in North America.
It does no favors for the American, Mexican or Canadian economies to have this uncertainty hanging over them, and in due course a more robust and reliable trading relationship will surely be in everyone’s interest.
The regional free trade agreement between the three countries, USMCA is due for renegotiation next year, and it will be interesting to see if the neighbors have established a more normal working relationship by then.
Certainly a month-to-month threat of tariffs followed by last-minute cancellations doesn’t seem sustainable.
Some of the sweeping 25% tariffs which US President Donald Trump imposed on Mexico and Canada just a few days ago will now be suspended until next month here’s what we know so far about today’s changes:
The exemptions announced today only apply to goods covered under the USMCA trade agreement that accounts for around half of Mexico’s exports to the US, and less of Canada’s
The suspension runs until 2 April, when Trump has teased reciprocal tariffs against other countries could be imposed
Asked if at that point car manufacturers who the president says were crucial to the suspension being enacted could expect another reprieve, Trump says: “We’re not looking at that.”
Steel and aluminium tariffs will proceed as planned next week, he adds.
The turnaround was not forced by the stock market, according to the president, it has fallen in the days since the tariffs were first implemented. Trump says: “I’m not even looking at the market because long-term the United States will be very strong with what’s happening here.”
Mexican President Claudia Sheinbaum thanked Trump for the pause, and says the two countries “will continue to work together” to combat fentanyl crossing the border. (Int’l News Desk)
