Unlock the White House Watch newsletter for free
Your guide to what the 2024 US election means for Washington and the world
Donald Trump said he would press ahead with imposing tariffs of 25 per on all imports from Canada and Mexico from Tuesday, adding that there was “no room” for last-minute negotiation.
The president’s comments worsened a market sell-off amid growing fears that the tariffs could damage the US economy and trigger a trade war with America’s largest trading partners.
The S&P 500 share index closed 1.8 per cent lower after its worst session of the year, while the tech-dominated Nasdaq Composite dropped 2.6 per cent. Individual stocks fared worse, with chipmaker Nvidia plunging 8.7 per cent and energy group ConocoPhillips down 6.6 per cent.
Trump’s remarks came a day after his commerce secretary Howard Lutnick suggested that the extent and timing of the planned tariffs were still to be finalised, describing the situation as “fluid”.
But at the White House on Monday afternoon, Trump said: “The tariffs, you know, they’re all set. They go into effect tomorrow.”
Trump’s announcement on Monday comes after a slew of recent data has raised concerns over the health of the US economy.
On Monday, the Federal Reserve Bank of Atlanta’s running estimate of US GDP growth pointed to a 2.8 per cent fall in the first quarter, a much steeper decline than it had suggested on Friday. Economists attributed the shift in part to uncertainty over Trump’s tariffs.
Washington has for months threatened Mexico and Canada with levies and demanded that they tighten their borders and clamp down on the trafficking of the deadly opioid fentanyl.
Last month, the president issued an executive order applying additional tariffs of 25 per cent to all imports from Canada and Mexico, with the exception of Canadian oil and energy products, which will face a 10 per cent levy.
Canada is by far the biggest foreign oil supplier to the US, accounting for about 60 per cent of its crude imports.
Days later, he postponed the implementation of the tariffs to March 4, following frantic last-minute diplomacy between Trump and Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau.
On Monday, Trump said that Canada and Mexico were “going to have a tariff”, suggesting that the measures would incentivise the two countries to move more of their manufacturing into the US.
“So what they have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs,” he said.
Last week, Trump threatened to boost his additional tariffs on Chinese imports to 20 per cent beginning on Tuesday. A White House official confirmed on Monday that Trump had already signed an executive order to apply tariffs of 20 per cent on Chinese imports beginning on Tuesday.
When asked on Monday what the maximum tariffs he would apply against Chinese imports would be, he replied: “I can’t say, it depends on what they do with their currency, it depends on what they do in terms of . . . some kind of an economic retaliation.”
Trump added that he did not expect Beijing to “retaliate too much”.
Canadian foreign minister Mélanie Joly said Canada would be “ready” with retaliatory tariffs should the US apply its levies.
The US president’s remarks on tariffs came after he announced that the world’s biggest chipmaker, TSMC, would invest $100bn in advanced manufacturing in the US, in the latest overture by business to the Trump administration.
Additional reporting by George Steer
Credit: Source link
