Published 07:07 IST, February 3rd 2025
Trump to Discuss Tariffs with Canada, Mexico Leaders as Trade War Heats Up
US President Donald Trump will be holding talks tomorrow with Canada and Mexico over the 25% tariffs imposed by the US and their retaliatory measures.

Washington: US President Donald Trump has decided to hold talks tomorrow with Canada and Mexico after the countries imposed retaliatory tariffs on the United States. Trump took the world by storm when he signed an order, imposing 25% import tariffs on Canada, Mexico and China on Saturday.
Tariff War: Trump to Hold Talks to Canada, Mexico Tomorrow
As per latest reports, US President Donald Trump is all set to hold talks with Canada and Mexico tomorrow amid the ongoing ‘tariff war’. Trump had imposed import tariffs on the two countries and China, following which Canada and Mexico imposed retaliatory tariffs in a tit-for-tat move.
Canada and Mexico Impose Retaliatory Tariffs in Tit-For-Tat Move
Canada and Mexico have announced retaliatory measures against the US. The Canadian administration has also decided to impose 25 per cent tariffs on over USD 155 billion worth of US products, including alcohol and fruit. On the other hand, Mexico's President Claudia Sheinbaum, also announced new tariffs and suggested the US should do more to address drug addiction. The Chinese government has also condemned the tariffs imposed by the US and has vowed to defend its economic interests and file a lawsuit with the World Trade Organization (WTO).
Meanwhile, the tariffs are expected to have a significant economic impact. An analysis by the Budget Lab at Yale shows that if the tariffs continue, the average US household would lose around USD 1,245 billion in income this year, equivalent to a USD 1.4 trillion tax increase over the next decade.
The economists have criticised Donald Trump's tariffs, calling them "a self-inflicted wound to the American economy." Former Treasury Secretary Larry Summers, said, "Inflation might go up over the next nine months by as much as 1 per cent, just at a moment when we were trying to bring it down."
What Tariffs Are Imposed on Canada, Mexico and China?
The tariffs would start at the beginning of Tuesday. There would be an additional 25% tariff on imports from Canada, with a lower 10% charge on the oil, natural gas, electricity and other energy products.
Energy products were taxed at a lower level to prevent U.S. consumers and businesses from paying higher prices for gasoline and utilities. Mexican imports would face an additional 25% tax. China would face an additional 10% tariff.
While Trump has said that foreigners pay these taxes, the tariffs would be paid by the individuals and companies bringing in the goods — which means this would be a domestic tax increase.
Why Has US Imposed Tariffs on Canada, China and Mexico?
Trump's orders say the tariffs are a consequence of illegal immigration and drug smuggling. Not everyone will agree with his reasoning, as U.S. government reports show that unauthorized border crossings from Mexico have fallen over the past year and seizures of fentanyl along the northern border are relatively low.
But Trump's order on Mexico says that drug traffickers and the country's government “have an intolerable alliance” that “endangers the national security of the United States, and we must eradicate the influence of these dangerous cartels.” His order on Canada says that Mexican cartels are operating in that country and claims despite the modest amount of fentanyl intercepted that it would be enough to kill “9.5 million Americans.” The order on China says that country's government provides a “safe haven” for criminal organizations to “launder the revenues from the production, shipment, and sale of illicit synthetic opioids.”
Those are the stated legal reasons, but Trump has expressed a deep admiration to tariffs in general, claiming that they would make the United States wealthier even though they are tax hikes that can be passed along to consumers and businesses in the form of higher prices.
(Inputs from AP)
Updated 10:45 IST, February 3rd 2025