Canada and Mexico Exempt from Trump’s April Tariffs Amid Ongoing Trade Tensions

Canada and Mexico were excluded from President Trump’s April 2 tariffs, initially set at 10%-45%, primarily due to existing tariffs on their goods and protections under the USMCA. Despite this reprieve, ongoing tariffs still pose challenges. Both countries are assessing their responses to the announcement.

On April 2, 2024, President Donald Trump unveiled a series of reciprocal tariffs aimed primarily at various countries, citing grievances against international trade practices. However, Canada and Mexico were notably exempted from these tariffs, which ranged from 10 percent to as high as 45 percent on imports. The exclusion of these two countries was a significant relief amid broader economic tensions.

While Canada and Mexico avoided the new tariffs, they are not entirely free from penalties, as existing tariffs on their goods remain intact. President Trump previously imposed a 25 percent tariff on imports from both nations, alongside a 10 percent levy specifically for Canadian energy and potash. These longstanding tariffs will continue to affect trade between the United States and its northern neighbors.

Nonetheless, trade under the US-Mexico-Canada Agreement (USMCA) will exempt many goods from additional tariffs, ensuring that existing duties do not cripple trade relations. However, should new agreements be pursued, Canada and Mexico will face the potential of Trump’s baseline tariff rates.

In response to the tariff announcements, Canadian Prime Minister Mark Carney vowed to oppose these measures in order to protect domestic workers, stating, “We are going to fight these tariffs with counter-measures.” Mexican President Claudia Sheinbaum is anticipated to provide Mexico’s official stance in a forthcoming press conference.

Additionally, it should be noted that countries such as Russia were also excluded from the tariffs due to existing sanctions. The tariffs, characterized by significant rates for other nations such as India at 26 percent and China at 34 percent, are part of Trump’s ongoing trade policy.

Notably, Trump’s tariffs come amid his reelection campaign, during which he has expressed intentions to increase tariffs on Chinese goods significantly, raising concerns over the potential impact on global trade dynamics and economic stability.

In summary, Canada and Mexico successfully avoided the new reciprocal tariffs announced by President Trump on April 2, 2024, although they continue to grapple with pre-existing tariffs. The exemption is largely attributed to their participation in the USMCA, which shields many goods from additional charges. As the situation unfolds, both nations are preparing to respond strategically to safeguard their economic interests.

Original Source: www.hindustantimes.com