After the decision of the new US President Donald Trump to impose tariffs on Canada, Mexico, and China, these countries have started taking retaliatory action.
US President Donald Trump has signed an order to impose a 25 percent tariff on goods imported from Canada and Mexico and a 10 percent tariff on China.
After this decision, Canadian Prime Minister Justin Trudeau held a press conference late Saturday night and informed about the retaliatory action. Trudeau has resigned from the post of the head of the Liberal Party of Canada and the Prime Minister and will remain the Prime Minister of the country until the next party chief is elected.
He has said about Donald Trump’s decision that Canada is also ready for this.
At the same time, Mexico and China have also said that they will also take retaliatory steps regarding the decision of the US government.
What decision did Trudeau take?
Canadian Prime Minister Justin Trudeau held a press conference in which he addressed the people of America directly.
He clearly said that this decision would have a direct impact on prices and the American economy. Speaking on the historical relations between the two countries, he said “This is a relationship that the world has been jealous of.”
Informing about the decision of the Canadian government, Trudeau said that “Canada ‘did not want this’, but is ‘ready’ to respond to Trump’s announcement regarding tariffs.”
He said, “The United States has confirmed that it intends to impose a 25 percent tariff on most Canadian goods, and a 10 percent tariff on energy, from February 4.”
“I have met key ministers and our cabinet today, and I will soon talk to Mexican President Sheinbaum.”
Trudeau said, “We did not want this, but Canada is ready. I will address the citizens of Canada in the evening.”
Before taking the oath of office, Trudeau met Trump in Florida.
The Canadian Prime Minister has said that he will keep all options open for talks with the US President.
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US President Donald Trump has repeatedly alleged that the drug Fentanyl is coming to the US from the Canada-Mexico border.
Trudeau was asked whether the US decision was due to Fentanyl. To this, Trudeau said that the US-Canada border is ‘one of the safest and strongest borders in the world.’
He said that the next few weeks will be difficult for Canada and the US.
He said, “We did not want to come this far, we did not even want this. But we will not step back for the Canadian people.”
What decision did Mexico and China take?
Mexico President Claudia Sheinbaum has also reacted to the 25 percent tariff imposed on Mexico by US President Donald Trump.
She has said that ‘we will also take retaliatory action against the US, including tariffs.’
President Sheinbaum wrote, “I direct the Secretary of Economy to implement Plan B, which we are working on. This includes tariff and non-tariff measures related to the protection of Mexico.”
However, information has not been given about what these will be.
China’s Ministry of Commerce has also reacted on this issue, in which it has warned of retaliatory action against this move.
China’s Ministry of Commerce said in a statement, “China is completely dissatisfied with this move and strongly opposes it.” It said that this is a ‘serious violation’ of the rules of the World Trade Organization.
China has said that such measures will harm the normal economic and trade cooperation between China and America.
China has said that it will now file a case in the World Trade Organization against the ‘wrong behavior’ of America and will take retaliatory measures ‘to protect its rights and interests’.
The statement of the Chinese Ministry of Commerce said that China appeals to the US to correct its wrong ways and work together with China to resolve the problem.
China has asked the US to work to resolve differences and strengthen cooperation based on mutual benefit, respect, and equality.
Earlier, a statement by China’s Commerce Ministry spokesperson He Yadong appeared in China’s official news agency Xinhua on the issue of tariffs.
It said that the tariff measure is neither in the interest of China or the US nor the rest of the world.
In fact, on Saturday, US President Donald Trump wrote on Truth social media that the decision to impose tariffs was taken through the International Emergency Economic Powers Act (IEEPA).
Is this the beginning of a new trade war around the world?
BBC Business Correspondent Jonathan Joseph spoke to Paul Ashworth of consultancy Capital Economics about the issue.
According to Paul Ashworth of consultancy Capital Economics, this could trigger a “very destructive trade war”.
He said that both Mexico and Canada export about 20% of their economies to the US, and these tariffs could put their economies into recession.
“These tariffs will make their products more expensive for Americans and people will stop buying them which simply means less sales and profits for Mexican and Canadian companies.”
Ashworth has also pointed to the possibility of the European Union also facing US tariffs in the coming months. This will probably lead to similar consequences.
He also warned that the higher prices faced by US businesses and consumers will increase inflation and mean that the path to any US interest rate cuts in the next one to one and a half years will be “closed.”
Paying off higher debt costs could potentially lower the standard of living of American consumers and reduce the willingness of businesses to invest in the future.
It would also hurt governments and others around the world who borrow money in US dollars.
