US President Donald Trump, who assumed office with a promise to unleash a tariff war on all countries with which America has a trade deficit, it seems, is slowly realising that his actions could do more damage at home than elsewhere. On Thursday, Trump was forced to announce a 'temporary pause' on the 25 per cent tariffs on Canadian and Mexican imports amid a stock market crash and fears of recession due to the trade war.
This followed a one-month tariff exemption for vehicles transported under the United States-Mexico-Canada Agreement (USMCA), announced earlier in the day.
According to Trump, the tariffs will now come into effect on April 2, when the reciprocal tariffs on other countries, including India, will be enforced. The White House also claimed that the current one-month pause is only for a selected, small portion of Canadian and Mexican imports and added that approximately 62% of Canadian imports would remain subject to new duties.
Trump, who has a history of bullying other countries to get what he wants, failed to achieve the same this time with Mexico and Canada, as the two countries also announced similar retaliatory measures.
While Trump and his supporters have defended the tariffs, saying the duties will be paid by countries like Canada, Mexico and China, in reality, it is paid by US companies that import the goods, and the extra cost is passed on to American customers.
Trump's tariff war on Canada and Mexico was so bad that Rupert Murdoch-owned Fox News, which is the US President's favourite news channel, recently aired a segment explaining how the cost of the tariffs will ultimately be borne by the American public and not the Chinese, Canadian or Mexican companies that export them.
US Treasury Secretary Scott Bessent said Thursday that he was not concerned Trump¡¯s tariffs would be inflationary, adding that any impact on prices would likely be temporary.??
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