Trump announces talks with Canada, Mexico over sweeping tariffs
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US President Donald Trump said he did not "expect anything very dramatic" in his upcoming talks.
PHOTO: AFP
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WASHINGTON - Mexican President Claudia Sheinbaum said tariffs would be delayed for one month, after a conversation with US President Donald Trump on Feb 3.
Mr Trump had said earlier that he would discuss the punishing tariffs he has levied on Canada and Mexico with both countries on Feb 3, after arguing that Americans may feel economic “pain” from the 25 per cent duties but that they will be “worth the price”.
Speaking to reporters after he flew back to Washington on the evening of Feb 2 from a weekend in Florida, Mr Trump said he was “speaking with Prime Minister (Justin) Trudeau tomorrow morning, and I’m also speaking with Mexico tomorrow morning”.
“I don’t expect anything very dramatic,” he added.
Mr Trump has also hit China with a 10 per cent tariff in addition to levies already in place.
A fervent supporter of tariffs, Mr Trump has always maintained that their impact would be borne by foreign exporters, without being passed on to American consumers, contradicting the opinion of a broad range of experts.
Earlier on Feb 2, he acknowledged, in a series of messages on his Truth Social media platform, that Americans may feel economic “pain” from his tariffs, but argued that they would be “worth the price” to secure US interests.
China, Mexico and Canada are the United States’ top three trade partners, and all have vowed to retaliate when the tariffs take effect on Feb 4.
“Will there be some pain? Yes, maybe (and maybe not!)” Mr Trump wrote on the morning of Feb 2 in all-caps on Truth Social.
“But we will Make America Great Again, and it will all be worth the price that must be paid.”
Analysts expect the trade war to slow US growth and increase prices, at least in the short term, something the President had resisted acknowledging after frustration over rising costs was seen as a major factor in his 2024 election win.
Seeking to limit a spike in fuel prices, Mr Trump has put the levy on energy imports from Canada at only 10 per cent.
The President has cited illegal immigration and the trafficking of the deadly opioid fentanyl as reasons for the “emergency” measures.
But on Feb 2, he also expressed general outrage at trade deficits, which he has long viewed as signs of unfair treatment against the US.
“The USA has major deficits with Canada, Mexico and China (and almost all countries!), owes 36 trillion dollars, and we’re not going to be the ‘stupid country’ any longer,” he wrote.
The tariff announcements capped an extraordinary second week of Mr Trump’s new term, with the President facing the worst US aviation disaster in years – even as his administration moved to drastically overhaul the government in actions decried by critics as illegal.
‘51st state’
In a separate social media post, Mr Trump took particular aim at Canada, repeating his call for America’s northern neighbour to become a US state.
Claiming that the US pays “hundreds of billions of dollars to subsidise Canada”, Mr Trump said that “without this massive subsidy, Canada ceases to exist as a viable country”.
“Therefore, Canada should become our cherished 51st state,” he said, reiterating the expansionist threat against one of his country’s closest allies.
The US Census Bureau says the 2024 trade deficit in goods with Canada was US$55 billion (S$75 billion).
Canadian backlash was swift, with videos posted on social media showing fans at a Toronto Raptors game on Feb 2 booing during the US national anthem.
Mr Trudeau on Feb 1 vowed to hit back with levies of 25 per cent on select American goods worth C$155 billion (S$144 billion), with a first round on Feb 4, followed by a second one in three weeks.
Leaders of several Canadian provinces have already announced retaliatory actions, such as the immediate halt of US liquor purchases.
A Canadian official said on Feb 2 that Ottawa will file a World Trade Organisation claim against the tariffs, and seek legal redress under a regional free trade deal.
“The Canadian government clearly considers these tariffs to be a violation of trade commitments that the United States has taken,” the official, speaking on condition of anonymity, told a briefing.
Ottawa also unveiled on Feb 2 a list of 1,256 American goods that it plans to target
The list includes cosmetics, appliances, tyres, tools, plastics, furniture, coffee, wines and spirits, dairy and fruits.
Officials said the Canadian tariffs do not specifically target Republican states, but aim to put pressure on lawmakers with influence over Mr Trump and who are more likely to be Republicans.
A second round of counter-tariffs could be announced in the coming weeks, when the total amount of products targeted would rise to C$155 billion.
“Our hope is that the actions we have taken already will be sufficient to persuade the United States that it has gone down the wrong path, and that they will reach out to work with us on how to get back to a more normal state,” an official said.
The White House has not publicly announced what actions could end the tariffs.
Canada’s Ambassador to the US Kirsten Hillman told ABC News on Feb 2: “It’s hard to know what more we can do, but we’re obviously open to any other suggestions that come our way.”
Federal overhaul
Mexican President Claudia Sheinbaum said she, too, was awaiting Mr Trump’s response to her proposal for dialogue.
She said she had directed her economy minister to “implement Plan B”, which includes unspecified “tariff and non-tariff measures”, promising to detail on Feb 3 the steps she intends to take.
Mr Trump said on Feb 2 that he also planned to hit the European Union with tariffs “pretty soon”, to which the EU said earlier it would “respond firmly”.
The drastic trade actions follow similarly sharp efforts by Mr Trump’s administration to quickly overhaul the federal government in his first two weeks in office.
Mr Trump’s close ally Elon Musk, the world’s wealthiest person, and his so-called Department of Government Efficiency were also pursuing efforts that were not fully clear, including reported attempts to probe federal payment and e-mail systems.
The tumult in the federal government coincided with the collision of an army helicopter and an airplane that killed 67 people in the US capital.
Mr Trump, addressing the crash on Jan 30 as aviation authorities began their formal investigation, baselessly placed the blame on diversity programmes. AFP, Reuters
