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President Donald Trump has temporarily postponed the implementation of 25% tariffs on Canada and Mexico, granting a 30-day reprieve that averts the risk of a significant trade confrontation between the North American neighbors.
This decision follows urgent discussions with Canadian Prime Minister Justin Trudeau, who has committed to bolstering security at the US-Canada border to curb the movement of individuals and the opioid fentanyl, which poses serious health risks.
In a related development, Trump reached an agreement with Mexican President Claudia Sheinbaum to enhance troop presence at Mexico’s northern border in exchange for the United States limiting arms trafficking into the country.
Despite the breakthrough with Canada and Mexico, a 10% tariff on imports from China is still scheduled to take effect shortly.
Trump referred to these import taxes as the “opening salvo,” suggesting they could escalate significantly if a resolution is not achieved in the near future.
The developments on Monday occurred just as Canada and Mexico were poised to introduce retaliatory tariffs on American imports.
Following their discussions, both leaders utilized social media to announce a temporary border security agreement, successfully avoiding immediate tariffs.
Trump labeled the agreement a positive step, stating, “As president, it is my responsibility to ensure the safety of ALL Americans, and I am doing just that. I am very pleased with this initial outcome,” as he shared on his platform, Truth Social.
Trudeau disclosed that Canada intends to implement a $1.3 billion border security strategy, which will incorporate around 10,000 frontline personnel and additional resources to combat fentanyl trafficking—a synthetic drug significantly more potent than heroin that has emerged as a major issue for both nations.
The Prime Minister also announced the appointment of a “fentanyl czar” and the creation of a joint task force with the US aimed at addressing issues related to crime, fentanyl, and money laundering.
Much of Canada’s border security initiative had been previously unveiled in December, encompassing enhanced cooperation with US law enforcement, improved information sharing, limited border traffic, and the deployment of drones and Black Hawk helicopters for surveillance purposes.
Additionally, the announcement follows Trump’s suspension of tariffs on Mexican goods, contingent upon Mexico deploying 10,000 National Guard troops at its border with the United States.
Sheinbaum communicated her positive engagement with Trump on social media, expressing respect for their bilateral relationship. Trump described their phone conversation as “very friendly,” reflecting a cooperative tone amid tense negotiations.
Historically, in 2019, Mexico’s administration had previously agreed to send 15,000 troops to its northern border to deter tariffs imposed by the Trump administration.
Trump has consistently positioned tariffs as an apparatus for enhancing the US economy, preserving jobs, and generating tax revenue. He stated that the country is in a strong position due to its economic stature.
However, economists have cautioned that escalating tariffs could lead to increased prices across various sectors, impacting goods ranging from automobiles to everyday consumer products.
The initial uncertainty brought on by these trade tensions led to fluctuations in stock markets, although they showed signs of recovery following the announcement regarding the postponement of tariffs.
Andrew Furey, the Premier of Newfoundland and Labrador, recognized the temporary relief offered by the 30-day delay but warned about the persistent threat of a trade conflict. He expressed hope that a diplomatic approach would mitigate future tariff issues, acknowledging the complexities of dealing with the United States as a closest ally.
Ontario’s Premier Doug Ford welcomed the suspension of countermeasures but maintained vigilance regarding future tariff threats, suggesting that the looming potential will remain a concern for Canada regardless of immediate agreements.
Trump recently indicated that his tariff strategy might soon extend to the 27-nation European Union, while mentioning that the UK, having exited the EU, may potentially face fewer tariff consequences.
Source
www.bbc.com