Trump changes course and delays some tariffs on Mexico and Canada
US President Donald Trump has postponed 25 per cent tariffs on many imports from Mexico and some imports from Canada for a month amid widespread fears of the economic fallout from a broader trade war.
The White House insists its tariffs are about stopping the smuggling of fentanyl, but the taxes proposed by Trump have caused a gaping wound in the decades-old North American trade partnership, and Canada has felt compelled to quickly take aggressive countermeasures.
Trump's tariff plans have also caused the stock market to sink and alarmed US consumers.
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US President Donald Trump says he has postponed 25 per cent tariffs on most goods from Mexico and Canada for a month. AP
The reprieve would apply to goods that are compliant with the trade agreement Trump negotiated with Canada and Mexico in his first term.
Imports from Mexico that comply with the 2020 USMCA trade pact would be excluded from the 25 per cent tariffs for a month, according to the orders signed by Trump.
Imports from Canada that comply with the trade deal would also avoid the 25 per cent tariffs for a month, while the potash that US farmers import from Canada would be tariffed at 10 per cent, the same rate at which Trump wants to tariff Canadian energy products.
Roughly 62 per cent of imports from Canada would likely still face the new tariffs because they're not USMCA compliant, according to a White House official who insisted on anonymity to preview the orders on a call with reporters. Half of imports from Mexico that are not USCMA compliant would also be taxed under the orders being signed by Trump, the official said.
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People wave flags and hold signs during a protest outside the US embassy in Vancouver, British Columbia, on Tuesday, March 4, 2025. (Ethan Cairns/The Canadian Press via AP) AP
Trump's on-again, off-again tariffs threats have roiled financial markets, lowered consumer confidence, and enveloped many businesses in an uncertain atmosphere that could delay hiring and investment.
Lutnick emphasised that reciprocal tariffs, in which the United States applies import taxes on countries that tariff US exports, will still be implemented April 2.
Also on Thursday (Friday AEDT), Canadian Prime Minister Justin Trudeau indicated that he expected his country would be in a trade war with the US for the foreseeable future.
Trudeau said the broader month-long pause "aligns with some of the conversations that we have been having with administration officials".
The Canadian leader said the move by the Trump administration was a "promising sign" but also "means that the tariffs remain in place and therefore our response will remain in place".
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