Trump Agrees to Suspend Tariffs on Canada and Mexico Following Promises to Enhance Border Security

On Monday, President Donald Trump agreed to suspend for 30 days his looming tariff threats against Mexico and Canada. Why this sudden change of heart? It appears our two largest trading allies made significant efforts to tackle Trump’s concerns over border security and drug-related issues, efforts that warranted a temporary reprieve.

Consider this pause a cooling-off period after what could only be described as a tempestuous few days. North America found itself on the brink of a trade war—a situation brimming with the potential to stifle economic growth, inflate costs, and dismantle essential partnerships. Trump’s announcement on social media made it abundantly clear: “I am very pleased with this initial outcome, and the Tariffs announced on Saturday will be paused for a 30 day period to see whether or not a final Economic deal with Canada can be structured. FAIRNESS FOR ALL!”

Canadian Prime Minister Justin Trudeau added his voice to the chorus of cautious optimism. In a post on X, he detailed the steps Canada would take during this hiatus: appointing a fentanyl czar, labeling Mexican cartels as terrorist groups, and initiating a “Canada-U.S. Joint Strike Force to combat organized crime, fentanyl, and money laundering.” An ambitious agenda, no doubt.

This pause mirrors a similar arrangement with Mexico, granting time for negotiation on drug smuggling and illegal immigration. Interestingly, the 10% tariff levied on China still looms, set to commence as planned. Yet, Trump indicated forthcoming conversations with Chinese President Xi Jinping, adding another layer of intrigue to this diplomatic dance.

But what does this mean for the much-dreaded trade war that had investors, enterprises, and political powers in a tizzy? Momentarily, it appears less likely, though not altogether averted. Canada’s and Mexico’s temporary reprieve could just as easily end in renewed tariffs. Already, the U.S. has set its sights on imposing taxes on European Union imports, casting a shadow of uncertainty over the global economy.

Imagine the collective shock when Trump declared a 25% tariff on imports from Mexico and Canada, alongside a 10% tariff on Canadian resources like oil and natural gas. It’s as though the U.S. president pulled the rug from under us all—a move many saw coming yet still faced with incredulity.

Analyses from entities such as the Tax Foundation, the Tax Policy Center, and the Peterson Institute for International Economics paint a grim picture. Tariffs may curb economic expansion, diminish income, and inflate prices. Still, Trump adheres steadfastly to their utility, claiming they force nations to curb illegal immigration and drug smuggling and afford the U.S. the respect it deserves.

The monthlong tariff détente with Mexico, following a “very friendly conversation” between Trump and Mexican President Claudia Sheinbaum, signals a willingness to negotiate. High-level officials from both nations, including U.S. Secretary of State Marco Rubio, will hammer out details. Sheinbaum, for her part, pledged the deployment of 10,000 National Guard troops to fortify the border, while the U.S. vows to stymie the trafficking of high-powered weapons to Mexico.

The mood was less optimistic in Canada on Monday, until, hastily, an agreement materialized. A senior Canadian official, who wished to remain nameless, expressed skepticism about avoiding tariffs—the goalposts seemed ever-moving, more so for Canada than Mexico.

During a Monday Oval Office meeting, Trump played coy when asked what Canada might offer in negotiations. “I don’t know,” he quipped, dreamily toying with the concept of Canada as a 51st state. It was a hiccup in what should be a steady partnership, a relationship spanning from World War II to solidarity in the wake of the 9/11 attacks.

Trump foreshadowed harsher tariffs against China should talks falter, raising alarm bells across financial markets. In grocery aisles, Stew Leonard Jr., head of a chain in the Northeast, plotted a switch from Canadian to Norwegian salmon while considering stocking up on Mexican tequila.

Stocks dipped slightly, a testament perhaps, to hope that these tumultuous times might be temporary. Trump, as reporters filed out of the Oval Office, asked casually about the markets—a moment of self-reflection, perhaps?

The decision to worship tariffs like an errant deity reflects a deep uncertainty surrounding Trump—adored them enough to lament the 1913 transition from tariffs to income taxes as the primary U.S. revenue source. True to form, Kevin Hassett, director of the National Economic Council, argued Monday that this was no trade war. “This is a drug war,” he corrected, even as Trump’s rhetoric often centers not on drugs but on perceived trade injustices.

While these orders focus ostensibly on drug interdiction, Trump himself has not been silent about his belief that America’s economic strategies must change. On Sunday, he hinted at imminent tariffs on European Union products.

Trump’s remarks underscore his desire to wield tariffs as diplomatic hammers: “Tariffs are very powerful both economically and in getting everything else you want. Tariffs for us, nobody can compete with us because we’re the pot of gold.” An evocative metaphor, don’t you think?

Take Jaime Bricker from Skagway, Alaska, for instance. Her community relies on Canadian tourism like flowers rely on spring. The specter of tariffs portends uncertainty. Even a recent trip to Vancouver found her absorbed in conversations with concerned locals—from cab drivers to waiters—all worried about shrinking exchange rates and rising tariffs.

“It seems to be a fluid situation and it’s difficult to know just how impactful it will be without knowing for certain what could come in the days ahead,” she reflected—a sentiment, no doubt, shared by many along the economic spectrum.

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Gillies reported from Toronto, and Sánchez reported from Mexico City. Associated Press writers Anne D’Innocenzio in New York and Becky Bohrer in Juneau, Alaska, contributed to this report.

Edited By Ali Musa
Axadle Times International–Monitoring