Starting Tuesday, March 4, Chinese, Canadian and Mexican products imported into the United States will be subject to additional taxes, Donald Trump confirmed Monday. The White House tenant claims that these three countries are not doing enough to combat fentanyl trafficking.
It’s done. US President Donald Trump signed an executive order on Monday that increases customs duties on Chinese products entering the United States, bringing them to 20% from 10% until now, criticizing Beijing for not having done enough to limit the flow of fentanyl into the United States.
These customs duties, initially announced on February 1 as a desire to combat the opioid crisis hitting the country, now come into effect due to China’s “inability” “to combat the flow of fentanyl pouring into our country ,” the White House said in a publication on X. In addition, the American president confirmed that the customs duties on Canadian and Mexican products will take effect on Tuesday. They have “no wiggle room remaining to avoid, Donald Trump warned.
Washington, Ottawa and Mexico are still negotiating to permanently halt the flow of fentanyl, a powerful opioid responsible for the deaths of tens of thousands of people in the United States. Donald Trump accuses Canada, Mexico and China of not fighting this traffic effectively enough – a motivation that seems largely a pretext, at least in the case of Canada’s neighbor, since fentanyl trafficking on the northern border remains tiny: barely 0.2% of seizures in 2024.
In order to force the three countries to act, he imposed 25% customs duties on all Canadian and Mexican products in early February, which were theoretically protected by a free trade agreement signed during his first term, before suspending them for a month, satisfied with the initial gestures made by Ottawa and Mexico. At the same time, China was imposed an additional 10% customs duties, in addition to the 10% already imposed in early February.
Just after Donald Trump’s remarks, Canadian Foreign Affairs Minister Mélanie Joly called these customs tariffs an “existential threat” to her country, where “thousands of jobs are at stake.” “If the United States decides to launch its trade war, […] we are ready to respond,” she warned. A few hours later, Ottawa formalized its response by announcing the implementation of customs duties on American products starting Tuesday in retaliation for those announced by Donald Trump, Prime Minister Justin Trudeau said Monday, estimating that “nothing justified these measures” by the Americans.
“If the U.S. tariffs go into effect, Canada will retaliate as of midnight by implementing 25% tariffs on $155 billion worth of U.S. goods,” the Canadian prime minister said in a statement. Mexican President Claudia Sheinbaum has already assured that Mexico has “a Plan A, a Plan B, a Plan C and a Plan D” against these new taxes.
Concern among American businesses and consumers
Donald Trump had stressed during his election campaign that “tariffs” were “his favorite words.” He had said he wanted to use them to rebalance the American trade balance, partly finance his promise to lower taxes and impose “respect” on the United States’ partners.
The American president has already announced his intention to tax steel and aluminum and the launch of an investigation with a view to doing the same for forestry products. On Monday, imported agricultural products were added to the list , Donald Trump assuring that they will also be taxed from April 2. In a message posted on his social network Truth Social, the American president invites “the great farmers of the United States” to prepare to “produce much more agricultural products to sell them within the United States.”
The prospect of tariffs is, however, starting to worry Americans, both consumers and businesses. At the end of February, two consumer confidence indices plunged, weighed down by fears of a rebound in inflation. Inflation is struggling to return to the 2% targeted by the Federal Reserve (Fed) and even increased slightly by the end of 2024. This is essential data, given that the American president owes his victory mainly to his promise to lower prices and improve household purchasing power.
The release of the ISM industrial production index on Monentry into forday was accompanied by comments about concerns in a number of industries that tariffs are becoming a new reality. “Price increases have accelerated because of the tariffs, leading to delays in placing new orders, supplier disruptions and inventory impacts,” said Timothy Fiore, an ISM official. Manufacturers in the chemicals, transportation, machine tools and food industries are increasingly speaking out about the impact of tariffs on their businesses.
On Monday, Trump’s announcements further fueled concerns on Wall Street, which plummeted to close the day sharply lower: the Dow Jones fell 1.48%, the Nasdaq index fell 2.64% and the broader S&P 500 index dropped 1.76%, its biggest loss since December.