The U.S. trade war escalation with Canada, Mexico, and China is heating up.
Businesses are warning of rising costs, stock markets are reacting with volatility. And the Trump administration is making aggressive moves to reshape global trade.
Temporary Reprieve for Automakers
The White House announced a one-month delay on tariffs for automakers whose vehicles meet the requirements of the U.S.-Mexico-Canada Agreement (USMCA). Commerce Secretary Howard Lutnick suggested that similar exemptions for agricultural products may also be considered.
Trudeau Demands Full Tariff Removal
Canadian Prime Minister Justin Trudeau reaffirmed his goal of eliminating all U.S. tariffs. Canada is discussing delaying its next round of retaliatory tariffs. Trudeau made it clear that his country won’t lift its own countermeasures unless the U.S. fully removes its tariffs.
China Warns of Retaliation in U.S. trade war escalation
Additionally, China has taken a firm stance, declaring that it is prepared to fight “any type of war” with the U.S. if trade tensions continue to escalate.
Trump Blames Biden for Record-High Trade Deficit
The U.S. trade deficit hit an all-time high of $131.4 billion in January, with imports surging 10%. Trump pointed the finger at his predecessor, writing on Truth Social, “Massive Trade Deficit with the World, just announced, compliments of Sleepy Joe Biden! I will change that!!!”
Canada and Mexico May Face Reciprocal Tariffs in escalation
Lutnick suggested that Canada and Mexico might only be subject to reciprocal tariffs on April 2 if they show progress in combating fentanyl trafficking. “If they do a good enough job on fentanyl, this part of the conversation could be off the table,” he said.
Stock Market Not a Concern for Trump
Despite the market’s instability, Lutnick stated that stock performance is not a priority for the administration. “The president is focused on rebuilding America,” he told CNBC, predicting strong economic growth and lower interest rates and only short term consequences in the U.S. trade war escalation.
Canada Pulls U.S. Products from Shelves
In response to U.S. tariffs, Canada has begun removing American products from its stores. The CEO of Jack Daniel’s called the move “worse than a tariff” as it directly impacts sales.
Walmart Pressures Chinese Suppliers for Discounts
Walmart is pushing its Chinese suppliers to slash prices by up to 10% to absorb the cost of Trump’s tariffs. However, many suppliers have refused, stating that such cuts would result in significant losses.
The trade war is far from over, with all sides preparing their next moves in an economic battle that could have lasting global consequences.
