US President Donald Trump on Monday confirmed that his administration will proceed with tariffs on Canada and Mexico starting next month, ending a monthlong suspension. He also reiterated his broader plan to impose new import taxes, a move that has sparked concerns over economic growth and inflation.
“We’re on time with the tariffs, and it seems like that’s moving along very rapidly,” Trump said at a White House news conference alongside French President Emmanuel Macron. He stressed that his proposed “reciprocal” tariffs would begin as early as April.
Trump has repeatedly claimed that other countries impose unfair import taxes that harm US manufacturers and jobs. He argues that the tariffs will generate revenue to reduce the federal budget deficit and create new jobs. “Our country will be extremely liquid and rich again,” he said.
Macron warns against trade war
In a Fox News interview later on Monday, Macron expressed hope that he had persuaded Trump to avoid a potential trade war, particularly while also challenging China with tariffs. “We don’t need a trade war,” Macron said. “We need more prosperity together.”
At the news conference, Macron suggested that discussions had led to some common ground. “We want to make a sincere commitment towards a fair competition where we have smooth trade and more investments,” he said, according to a translation of his remarks.
Mexico aims for a deal, Canada prepares response
Mexican President Claudia Sheinbaum appeared optimistic about reaching an agreement before Trump’s tariff deadline. “We would need to be reaching important agreements this Friday,” she told reporters, adding that Mexico remained in communication with the US and was ready to complete a deal.
Sheinbaum also said Mexico has pushed for the US to address domestic drug consumption and distribution rather than solely focusing on production in Mexico. She indicated she was open to speaking directly with Trump if necessary.
Meanwhile, Canada is preparing countermeasures. Trump plans to impose a 25% tariff on Mexican imports and broad tariffs on Canadian goods, with energy products such as oil and electricity taxed at a lower 10%.
Economic concerns mount
Businesses and investors remain uncertain about the potential impact of the tariffs. Walmart has warned about market instability, while the University of Michigan’s latest consumer sentiment index has dropped by roughly 10% over the past month due to concerns over tariffs and inflation.
Trump’s stance on tariffs played a key role in the 2024 presidential election, where voters backed him to curb inflation, which had surged to a four-decade high during President Joe Biden’s tenure. However, economists warn that the tariffs could ultimately raise costs for consumers and manufacturers reliant on global supply chains.
Potential broader trade conflict
Trump has positioned the tariffs as a tool to pressure Canada and Mexico into addressing issues such as illegal immigration and drug smuggling, particularly fentanyl trafficking. In response, Mexico has deployed 10,000 National Guard troops to its northern border, while Canada has appointed a special czar to tackle the issue.
Beyond North America, Trump has also hinted at additional tariffs aimed at matching the rates charged by other countries. These could be even higher than standard import taxes, factoring in subsidies, regulatory barriers, and Europe’s value-added tax (VAT).
The prospect of retaliatory tariffs from Canada, Mexico, and Europe could lead to a broader trade conflict. A February estimate by the Yale University Budget Lab projected that the Canadian and Mexican tariffs alone could reduce average US incomes by $1,170 to $1,245 annually.
Despite ongoing discussions with Canadian and Mexican officials, Trump’s decision to lift the suspension suggests a firm commitment to his tariff strategy. “The tariffs are going forward on time, on schedule,” he said.
