US President Donald Trump agreed on Monday to pause his planned tariffs on Mexico and Canada for 30 days. The decision comes as both countries took steps to address his concerns about border security and drug trafficking.
The pause follows days of uncertainty that raised fears of a trade war in North America. Such a conflict could have slowed economic growth, increased prices, and strained key trade relationships.
Trump announced on social media, “I am very pleased with this initial outcome, and the Tariffs announced on Saturday will be paused for a 30 day period to see whether or not a final Economic deal with Canada can be structured. FAIRNESS FOR ALL!”
Canadian Prime Minister Justin Trudeau confirmed the pause on X, saying that Canada will take several measures, including appointing a fentanyl czar, designating Mexican cartels as terrorist organizations, and launching a joint task force with the US to combat organized crime, fentanyl, and money laundering.
Trade war averted? Well, for now
Mexico has also reached a similar understanding with the US. The pause allows time for negotiations on drug smuggling and illegal immigration. Meanwhile, the 10 per cent tariff on Chinese imports remains in place, with Trump expected to speak with Chinese President Xi Jinping soon.
While the immediate risk of a trade war has eased, uncertainty remains. Trump could reintroduce tariffs, and he is also preparing to announce tariffs on imports from the European Union.
On Saturday, Trump had directed 25 per cent tariffs on goods from Mexico and Canada and a separate 10 per cent tariff on Canadian oil, natural gas, and electricity. Though he had previously indicated these actions, they still surprised investors, businesses, and lawmakers.
Analysts suggested that the tariffs could slow economic growth, reduce incomes, and raise prices. However, Trump defended them as necessary to address illegal immigration, drug smuggling, and what he sees as unfair treatment of the US
Trump and Mexican President Claudia Sheinbaum announced the pause after what Trump called a “very friendly conversation.”
He added, “I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a ‘deal’ between our two Countries.”
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