On the day of his inauguration, President Donald Trump indicated he might impose a 25% tariff on goods from Canada and Mexico starting February 1. This announcement has sparked concerns about escalating trade tensions between the United States and its neighboring countries.
Trump attacked Canada and Mexico for “abetting” illegal entry of fentanyl and migrants into the United States. “We’re thinking of tariffs of 25% on Mexico and Canada because they’re allowing vast numbers of people and fentanyl to come in,” Trump said, describing Canada as a “very bad abuser.
The declaration occurred at a press conference in which he unveiled executive orders on rules, immigration, and free speech. Before the comment on tariffs, the Mexican Peso and the Canadian Dollar had given way, and the dollar index had edged higher. He justified his stance, stating that tariffs increase the dollar’s strength.
Trump also touched on tariffs against China for alleged unfair trade practices and taking advantage of the United States. “China charges us tariffs, we charge them very little, except for what I did,” he said, emphasizing his earlier actions during his first term. But Trump avoided announcing immediate tariffs against China, citing further discussions with President Xi Jinping of China.
On the BRICS countries, Trump threatened a 100% tariff on business dealings with America, though he did not elaborate. The president has previously attacked the BRICS group, particularly China, for trade imbalances and unfair practices.
Trump also had Venezuela in his sights, suggesting the U.S. could stop importing crude oil from the country. “We don’t have to buy their oil; we have plenty of oil,” he said. The action may shake global oil markets, including Indian state refiners that import Venezuelan crude.
Additionally, Trump revealed that he intends to take action against the U.S. trade deficit with the European Union, either using tariffs or forcing more purchases of American oil and gas.
These early statements portend a more protectionist trade policy for the United States under the Trump administration and have potentially profound implications for global economics and politics.
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Source: Moneycontrol
News Desk
