Trump’s Trade War Escalates as US Tariffs Trigger Global Retaliation
WASHINGTON:
The United States has officially imposed sweeping tariffs on imports from Canada, Mexico, and China, sparking angry retaliatory measures from its largest trading partners. The move has rattled global markets and deepened economic tensions.
Key Developments in the Trade War
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US Tariffs on Canada & Mexico
- Trump reinstated 25% tariffs on $918 billion worth of imports from Canada and Mexico, citing their failure to curb illegal immigration and drug trafficking.
- The tariffs impact key sectors, including automobiles, lumber, and agriculture.
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Canada’s Strong Response
- Prime Minister Justin Trudeau condemned the tariffs as “a very dumb thing to do.”
- Ottawa imposed 25% retaliatory tariffs on $30 billion of US goods, with plans to expand to $125 billion within three weeks.
- Trudeau accused Trump of seeking to collapse Canada’s economy to facilitate annexation into the US.
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Mexico’s Reaction
- President Claudia Sheinbaum criticized the move and promised a formal response on Sunday.
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Tariff Hike on China
- Trump doubled tariffs on China from 10% to 20%, adding pressure to existing levies on various Chinese goods.
- Beijing retaliated by:
- Filing a complaint with the WTO.
- Imposing 10-15% tariffs on US agricultural imports.
- Suspending all imports of American lumber.
- Halting soybean shipments from three major US exporters.
Economic Impact & Global Concerns
- Stock markets plunged, with the S&P 500 erasing all gains since Trump’s election victory.
- The European Union warned that these tariffs could threaten global economic stability.
- The Tax Foundation estimated that these tariffs could shrink US economic output by 0.1%, even before accounting for foreign retaliation.
With major economies now locked in a trade war, uncertainty looms over supply chains, consumer prices, and diplomatic relations. As retaliatory measures escalate, the global economic fallout could intensify in the coming weeks.
