President Donald J. Trump announced new tariffs on imports from Canada, Mexico, and China on Saturday. The tariffs are part of efforts to address illegal immigration and drug trafficking, especially the influx of deadly fentanyl.
Trump used his powers under the International Emergency Economic Powers Act to impose a 25% tariff on imports from Canada and Mexico and a 10% tariff on imports from China. Energy resources from Canada will have a lower tariff of 10%. The administration wants to pressure these countries to keep their promises to fight illegal immigration and stop drugs from coming into the United States.
The flow of drugs, especially fentanyl, has created a national emergency and public health crisis. Chinese and Mexican officials have not done enough to fix this problem, leading to strong measures by the U.S. government. Mexican cartels have been working with the Mexican government, which has given them safe places to make and sell drugs.
This has made the overdose crisis in America worse. Mexican cartels have also been making fentanyl in labs in Canada. President Trump thinks that past U.S. administrations did not use America’s economic power well enough to secure borders and fight the fentanyl epidemic.
The U.S. has one of the most open economies and low tariffs in the world. In 2023, the U.S. trade deficit in goods was over $1 trillion. Tariffs are seen as an important tool to protect national interests.
These new tariffs are part of President Trump’s America First Trade Policy. He said the tariffs will stay in place until the flow of drugs and illegal immigration into the U.S. stops.
Trump’s new tariffs on drugs
Trump is still deciding whether to include oil imports from Canada and Mexico in the new taxes. “We may or may not [tax their oil],” Trump told reporters. We’re going to make that decision probably tonight.
The decision depends on whether Trump thinks the oil prices from the two countries are fair.
But his main reason is to stop illegal immigration and the smuggling of chemicals used to make fentanyl. Tariffs on Canadian and Mexican oil could go against Trump’s promise to lower inflation by reducing energy costs. Higher costs from tariffs could lead to higher gas prices for consumers.
Trump has promised to cut energy prices in half within a year. The United States imports a lot of oil from Canada and Mexico every day. In October, it was nearly 4.6 million barrels from Canada and 563,000 barrels from Mexico.
Some people warn that Trump’s tariffs would raise costs for Americans. “This is a lose-lose,” said Matthew Holmes from the Canadian Chamber of Commerce. “It makes life more expensive and disrupts our businesses.”
But Trump does not seem worried about the economic effects.
“We don’t need the products that they have,” Trump said. “We have all the oil you need. We have all the trees you need, meaning the lumber.”
Trump also talked about Chinese fentanyl and proposed a 10% tariff on top of existing taxes on Chinese goods.
This shows the ongoing trade tensions. Later on Thursday, Trump threatened more tariffs against countries thinking about using other currencies instead of the U.S. dollar for global trade. He mentioned the BRICS group, which includes Brazil, Russia, India, China, South Africa, and others.
