In his first press briefing after taking office, President Donald Trump announced that he may impose a 25% tariff on Canada and Mexico as early as February 1, potentially escalating trade tensions with the neighboring countries.
“We’re considering a 25% tariff on Mexico and Canada because they are allowing large numbers of people and fentanyl to enter the U.S.,” Trump stated, criticizing Canada for being a “bad abuser” due to concerns over illegal migration and the flow of fentanyl from the northern border.
This remark was part of a broader discussion where Trump introduced a range of executive orders addressing issues such as immigration, regulations, and free speech.
Following the tariff comments, the Mexican Peso and Canadian Dollar dropped, while the U.S. Dollar index edged slightly higher. Trump emphasized, “Tariffs are more effective because they help keep the Dollar stronger.”
Trump’s Stance on China Tariffs
Trump also touched on the issue of potential tariffs on China, expressing dissatisfaction with the trade imbalance. “China charges us tariffs, we charge them very little, except for what I did. They took in hundreds of billions of dollars, but until I came along, China never paid 10 cents to this country,” Trump said.
While he did not provide specific details on when or if new tariffs would be imposed on China, he mentioned upcoming meetings and calls with Chinese President Xi Jinping to address the issue. Trump also ordered a review to determine whether China has complied with a previous trade deal.
Trump hinted that he might impose tariffs on China if the proposed deal over TikTok, which would give the U.S. 50% control of the company, is not approved. His previous term saw the initiation of a trade war with China over intellectual property theft and currency manipulation.
BRICS and Venezuela Oil Imports
In addition, Trump raised the possibility of imposing a “100% tariff on BRICS nations” (Brazil, Russia, India, China, and South Africa) for business conducted with the U.S., although he did not offer further details. His criticism of BRICS trade practices, especially with China, is rooted in concerns over unfair trade and significant trade imbalances.
Regarding oil, Trump suggested that the U.S. would “probably” stop purchasing oil from Venezuela, citing America’s sufficient domestic oil supply. This decision could impact countries like India, which imports crude oil from Venezuela.
Trump also stated that he would seek to address America’s trade deficit with the European Union, either through tariffs or by encouraging European countries to purchase more U.S. oil and gas.
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