President Donald Trump on Saturday ordered steep tariffs on imports from Canada, Mexico, and China, citing a national emergency over fentanyl and illegal immigration, White House officials said.
The directive imposes a 25% tariff on Canadian and Mexican imports and a 10% duty on Chinese goods, effective Tuesday. Energy products from Canada will face a reduced 10% tariff, while Mexican energy imports will be taxed at the full 25%, officials told reporters.
Trump invoked the International Emergency Economic Powers Act to implement the tariffs, granting broad authority to address crises. White House officials confirmed that no exemptions would be granted, including for Canada, where the U.S. “de minimis” tariff exemption for shipments under $800 will also be revoked.
The move follows repeated warnings from Trump since his election victory last year and is expected to provoke retaliation, raising the risk of a global trade war. The tariffs could lead to significant economic disruption for all countries involved.
Trump, who spent Saturday golfing at his Mar-a-Lago estate before signing the order, has yet to address the media about the decision. He set the February 1 deadline to pressure China, Mexico, and Canada to curb fentanyl trafficking and illegal border crossings.
Less than two weeks into his second term, Trump’s policies are reshaping U.S. economic and foreign relations. Despite acknowledging the potential hardships for American consumers, he pledged Friday to move forward with the tariffs.
Economic projections from EY Chief Economist Greg Daco estimate that the tariffs could reduce U.S. growth by 1.5 percentage points in 2025, push Canada and Mexico into recession, and trigger domestic stagflation.
“We have stressed that steep tariff increases against U.S. trading partners could create a stagflationary shock—a negative economic hit combined with inflationary pressure—while also triggering financial market volatility,” Daco wrote Saturday.
Market reactions were swift, with the Mexican peso and Canadian dollar plunging Friday after Trump reaffirmed his tariff threats. U.S. stocks also declined, while Treasury bond yields climbed, signaling investor concern over potential economic fallout.
