Joey Garrison
WASHINGTON – In another tariff reversal, President Donald Trump took executive action Thursday postponing for one month new tariffs on imports from Canada and Mexico that fall under the United States-Mexico-Canada Agreement.
It’s the latest backpedaling in a trade war that Trump ignited earlier this week when he declared there was “no room left” for negotiations and imposed steep 25% tariffs on all goods imported from the two neighboring countries. On Wednesday, Trump agreed to exempt automobiles from the tariffs at the request of the three largest U.S. automakers.
The tariffs on imports covered in the USMCA, as well as auto imports, are on hold until April 2, when Trump’s reciprocal tariffs on goods from all nations that place fees on U.S. exports are set to go into effect.
“Most of the tariffs will go on April the second,” Trump said before signing two orders in the Oval Office to modify the tariffs. “Right now, we have some temporary ones and small ones, or relatively small, although it’s a lot of money having to do with Mexico and Canada. But the predominant tariffs will be reciprocal in nature.”
About 38% of U.S. imports from Canada fall under the USMCA ‒ a free trade deal Trump signed in 2019 ‒ meaning about 62% of goods from Canada will still be subject to tariffs, the Trump White House said. About 50% of imports from Mexico fall under the agreement, so about half of Mexican imports will be subject to the tariffs.
For Canada, Trump also agreed to a carve-out for potash, a key ingredient to make fertilizer used by farmers. Like energy imports from Canada, potash had been levied a smaller 10% tariff.
Trump signed a separate order formalizing the auto exemption he announced the previous day after the three largest U.S. automakers, Ford, General Motors and Stellantis, requested the reprieve.
“It basically makes it more fair for our car manufacturers during the short-term period before April 2,” Trump said. “April 2 is a little bit different. That will be much more significant.”
Trump has argued the tariffs are in retaliation for a lack of border security from Canada and Mexico that has allowed fentanyl produced in China to flow into the United States. Trump also placed an additional 10% tariff on imports from China.
Trump said he agreed to the one-month suspension for Mexico after speaking with Mexican President Claudia Sheinbaum, who he called “a wonderful woman.” Trump said the two leaders are working together on efforts to stop migrants and fentanyl from unlawfully entering the U.S.
Sheinbaum thanked Trump in a statement, saying they had an “excellent and respectful call” and agreed to continue to work together to reduce the entry of fentanyl into the United States and weapons into Mexico..
Trump says he’s not looking at the tumbling stock market
The steep tariffs imposed Tuesday on two of the biggest U.S. trade partners sent the stock market tumbling while stoking anxiety for consumers about higher costs.
Trump said Thursday “there will be disruption” as a result of his tariffs. He made a similar acknowledgment during his Tuesday night joint address to Congress. But he downplayed the rattled markets, blaming it on “globalist companies that won’t be doing as well” with the new tariffs.
“I’m not even looking at the market because long-term the United States will be very strong with what’s happening here,” said Trump, who routinely touted stock market gains during his first term.
Trump sharpens attacks on Canada’s Trudeau
Despite the reprieve for Canada, Trump on Thursday escalated his attacks against Canadian Prime Minister Justin Trudeau, who he has repeatedly needled by referring to him as “governor of Canada.”
“Believe it or not, despite the terrible job he’s done for Canada, I think that Justin Trudeau is using the Tariff problem, which he has largely caused, in order to run again for Prime Minister,” Trump said in a post Thursday on Truth Social. “So much fun to watch!”
Trudeau responded to the new tariffs Tuesday by announcing retaliatory 25% Canadian tariffs on American goods. He called Trump’s tariffs “a very dumb thing to do” in defiant remarks. “Canadians are reasonable and we are polite, but we will not back down from a fight,” Trudeau said.
Treasury Secretary Scott Bessent, in remarks Thursday at The Economic Club of New York, said Trump is open to negotiating tariffs but not “if you want to be a numbskull like Justin Trudeau and say, ‘Oh, we’re going to do this.'”
