Time is running out for Canada, Mexico, and China to avoid broad tariffs imposed by US President Donald Trump, with the planned levies set to take effect after midnight due to what he calls an “unacceptable” influx of drugs.
Trump initially announced blanket tariffs on imports from Canada and Mexico in February, citing their failure to curb illegal immigration and drug trafficking, but later paused them. That pause is set to expire on Tuesday.
The sweeping tariffs—reaching up to 25 percent—could disrupt supply chains in crucial industries like automobiles and construction materials, potentially driving up consumer prices. This, in turn, could complicate Trump’s efforts to lower household living costs, a key campaign promise.
Trump has also threatened an additional 10-percent tariff on Chinese goods, adding to an already existing 10-percent rate.
“There’s no doubt that the administration is trying to solve the long-standing fentanyl and immigration challenges, and these tariffs have given the administration leverage as we’ve seen with the response so far by Canada and Mexico,” said Ryan Majerus, a former US trade official.
Washington is also working to rebalance trade ties and improve conditions for American companies, he told AFP. However, he cautioned that using emergency economic powers to impose tariffs is a new approach.
“It remains to be seen how this will all play out in potential lawsuits,” added Majerus, now a partner at law firm King & Spalding.
Over the weekend, US Commerce Secretary Howard Lutnick told Fox News that while Mexico and Canada had made some progress on border security, they would still face tariffs.
He highlighted concerns over illicit fentanyl entering the US, noting that its ingredients originate in China. However, he suggested there could be room for negotiation:
“Exactly what they are, we’re going to leave that for the president and his team to negotiate,” Lutnick said, adding that tariffs on China were likely to remain unless Beijing stopped producing fentanyl ingredients.
Although Washington has targeted China over the drug trade, many fentanyl-related chemicals also have legitimate medical uses, making enforcement complex.
Canadian Prime Minister Justin Trudeau has pushed back against Trump’s claims, stressing that “less than one percent of the fentanyl and undocumented migrants that enter the United States come through the Canadian border.”
On Sunday, Trudeau stated that Ottawa would continue efforts to prevent new tariffs this week but warned:
“Canada would have a strong, unequivocal, and proportional response” if the levies take effect.
His government has already taken steps to address US concerns, including a Can$1.3-billion ($901-million) plan to bolster border security and appointing a fentanyl czar to lead anti-drug efforts.
Meanwhile, in a bid to avoid the tariffs, Mexico last week extradited several high-profile drug lords to the United States, including a notorious cartel leader wanted for decades over the murder of a US undercover agent.