No room for an 'in extremis' agreement: Trump says tariffs will be applied on Tuesday in Mexico and Canada
The US president assures that "everything is ready" for the 25% tariffs on his neighbors to come into effect
WashingtonLast January, Canada and Mexico achieved in extremis a thirty-day truce just before the tariffs took effect. This time, it seems that US President Donald Trump has assured that there is no room for a second postponement. "The tariffs are ready. They will go into effect tomorrow (Tuesday)," the president told reporters during a press conference on Monday to announce that the Taiwanese chip company, TSMC, will invest 100 billion dollars to create a chip facility in Arizona. It is also maintained that an additional 10% will be applied to China, which is added to the 10% that already came into effect last month on other existing taxes for Chinese imports.
At the moment Trump confirmed the tariffs, the Dow Jones stock index has plummeted more than 700 points this afternoon. The application of tariffs on Mexican and Canadian imports will also have a strong impact on the shopping basket of American citizens. The tariffs on Mexican imports will also have an impact on the US auto industry. Many US car companies manufacture their cars in Mexico or other countries to reduce costs. In fact, the manufacture of US cars on Mexican soil is possible thanks to a trade agreement negotiated by Trump during his previous presidency.
Even so, the Trump administration continues to sell tariffs as a winning policy. During the press conference on Monday, Commerce Secretary Howard Lutnick defined the Taiwanese investment as a triumph of protectionist measures. Lutnick has assured that the Taiwanese company will create the facilities in Arizona to manufacture chips because "they want to avoid tariffs," referring to the reciprocal tariffs that the US wants to apply starting in April.
For days now, confusion and chaos have been hovering over tariffs in Mexico and Canada. Last week, Trump raised false hopes when he mixed up tariffs against his neighbors with those of the EU and said they would take effect on April 2. This made it seem like the new government was giving its main trading partners an extra month of grace. After the Mexican peso and the Canadian dollar rose against the dollar, a member of the White House had to clarify that the tariffs would take effect on March 4 and that only after that would it be evaluated whether they would be stopped again or changes would be made. The next day, Trump corrected himself by telling Truth Social that, in addition to applying the 25% tariffs as of March 4, he would also apply an additional 10% for China.
The confusion, however, did not stop there. On Sunday night, Lutnick acknowledged on Fox that border crossings had fallen (one of the demands linked to the tariffs) and that Mexico and Canada are also considering imposing tariffs on China, as the US is asking. For all this, Lutnick assured that the tariffs could be less than 25% and it seemed that the door was also open to another truce.
From the beginning, Trump has linked the application of tariffs in Mexico and Canada with the reinforcement of the border to avoid the entry of migrants and fentanyl. The president is using trade tariffs to try to solve other problems that have no relation whatsoever.
Last January, Mexican President Claudia Sheinbaum managed to appease Trump with the promise of sending more soldiers to the border. Canadian President Justin Trudeau managed to please the tycoon by promising to appoint a "fentanyl czar" and signing a new intelligence directive on organized crime and fentanyl, for which he would allocate $200 million.
