Trump imposes new tariffs on Canada, Mexico, and China, igniting trade war fears

President Donald Trump will impose 25% tariffs on imports from Canada and Mexico, as well as 10% tariffs on goods from China, beginning Saturday, the White House said, but it did not say whether there would be any exemptions to the measures, which could result in sharp price increases for US consumers.

'President Donald Trump.'

Joe Raedle/Getty Images

Trump has threatened tariffs to ensure better cooperation from countries in combating illegal immigration and the smuggling of chemicals used in fentanyl production, but he has also vowed to use tariffs to stimulate home manufacturing and increase federal government income.

"Those tariffs will go into effect tomorrow," White House Press Secretary Karoline Leavitt told reporters. "These are promises made and promises kept by the president."

The tariffs pose both political and economic concerns to Trump, who is only two weeks into his second term. Many people supported the Republican on the promise of lowering inflation, but tariffs might raise costs and destabilize the energy, auto, timber, and agriculture sectors.

Trump had said that he was considering granting an exception for Canadian and Mexican oil imports, but Leavitt said she had no knowledge on the president's decision on any prospective carveouts.

In October, the United States imported over 4.6 million barrels of oil per day from Canada and 563,000 barrels from Mexico, according to the Energy Information Administration. During that month, the United States produced approximately 13.5 million barrels per day on average.

Trump has previously stated that a 10% tariff on Chinese goods will be added to existing import charges imposed on the country's exports.

Both Canada and Mexico have stated that they are prepared to deploy retaliatory tariffs if required, which may lead to a larger trade dispute that, according to economic analysts, might harm economy and exacerbate inflation.

Canadian Prime Minister Justin Trudeau warned Friday that Canada is prepared to retaliate if Trump imposes tariffs, but he did not provide details.

"We're ready with a response, a purposeful, forceful but reasonable, immediate response," he said. "It's not what we want, but if he moves forward, we will also act."

Trudeau said tariffs will have "disastrous consequences" for the United States, putting jobs at risk and raising costs. Trudeau underlined that Canada accounts for fewer than 1% of all fentanyl and unlawful border crossings into the United States.

Mexican President Claudia Sheinbaum said Friday that Mexico has been in contact with Trump's staff since before he returned to the White House, but she highlighted that Mexico has a "Plan A, Plan B, and Plan C for whatever the United States government decides."

"Now it is very important that the Mexican people know that we are always going to defend the dignity of our people, we are always going to defend the respect of our sovereignty and a dialogue between equals, as we have always said, without subordination," Sheinbaum said.