(WASHINGTON) — America’s closest neighbors, Canada and Mexico, excoriated President Donald Trump for slapping historic tariffs on goods from their countries.
Trump’s broad tariffs went into effect on Tuesday, along with increased duties on goods from China, a move that prompted a swift retaliation from Beijing.
“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement.
Goods entering the U.S. from Mexico and Canada will carry a 25% tariff, while those from China will be subject to a 10% increase on existing tariffs, according to the White House.
U.S. tariffs are at their highest level since 1943, Yale’s Budget Lab said.
On Feb. 27, Trump alleged that illicit drugs such as fentanyl had continued to enter the U.S. through Mexico and Canada despite agreements reached last month to address the issue.
Since September, nearly all fentanyl seized by the U.S. came through the Southern border with Mexico, according to the U.S. Customs and Border Patrol, or CBP, a federal agency. Less than 1% of fentanyl was seized at the Northern border with Canada, CBP found.
Canadian Prime Minister Justin Trudeau sharply criticized the tariffs, calling them a “dumb” policy that does not “make sense.”
The reason for the tariffs is based on a false allegation about Canada as a major source of drugs entering the U.S., Trudeau added.
“It’s an example of [Trump] not really being able to see what it is that he wants, because even the excuse that he’s giving for these tariffs today of fentanyl is completely bogus, completely unjustified [and] completely false,” Trudeau said.
In response, Canada slapped a 25% retaliatory tariff on $30 billion worth of goods. Tariffs on an additional $125 billion worth of products will take effect in 21 says, Trudeau said.
“We will not back down from a fight,” Trudeau added.
Meanwhile, Mexican President Claudia Sheinbaum announced plans to impose retaliatory tariffs on U.S. goods.
“There is no motive or reason, nor justification that supports this decision that will affect our people and our nations,” Sheinbaum said. “We have said it in different ways: cooperation and coordination, yes; subordination and interventionism, no.”
Sheinbaum said she will speak over the phone with Trump on Thursday, and if no deal can be reached, she’ll announce the tariff and non-tariff measures at a rally on Sunday.
China’s response
Within minutes of the new U.S. tariffs taking effect, China unveiled on Tuesday its initial response by placing additional 10% to 15% tariffs on imported U.S. goods, like chicken, wheat, soybeans and beef.
Those duties will be on top of similar tariffs imposed back during the first Trump administration’s trade war in 2018. Some of those tariffs are already at 25%, though Beijing issued some waivers as a result of the 2020 “phase one” trade deal.
The new Chinese tariffs are set to come into effect for goods shipped out next Monday, March 10.
Stock prices plummet
Stock futures for the three major U.S. indexes were close to flat early Tuesday following the selloff on Monday as Trump announced his proposed tariffs would go into effect at 12:01 a.m.
Stock prices plummet
Stock futures for the three major U.S. indexes were close to flat early Tuesday following the selloff on Monday as Trump announced his proposed tariffs would go into effect at 12:01 a.m.
Asian markets were mixed on Tuesday. The Shanghai Stock Exchange climbed less than a percentage point, while the Nikkei in Japan slipped about 1.2% and the Hang Seng in Hong Kong closed down about 0.3%.
European markets mostly traded off on Tuesday, with the DAX in Germany down about 1.6% and the FTSE 100 slipping about 0.3% midday.
The U.S. tariffs arrived about a month after Trump granted Mexico and Canada a reprieve, having reached agreements with the two countries regarding border security and drug trafficking.
ABC News’ Zunaira Zaki and Anne Laurent contributed to this report.
Copyright © 2025, ABC Audio. All rights reserved.