United States President Donald Trump on Monday dashed President Claudia Sheinbaum’s hopes of reaching a new agreement to stave off tariffs, announcing that 25% duties on all Mexican exports to the U.S. will take effect as scheduled on Tuesday.
“Very importantly, tomorrow tariffs, 25% on Canada and 25% on Mexico. … So they’re going to have a tariff,” Trump told reporters at the White House.
“So what they’ll have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs,” he said.
Asked whether there was “any room left for Canada and Mexico to make a deal before midnight,” Trump said time had run out.
“No room left for Mexico or for Canada. No. The tariffs you know, they’re all set. They go into effect tomorrow,” he said.
“Just so you understand, vast amounts of fentanyl have poured into our country from Mexico, and as you know also from China, where it goes to Mexico and it goes to Canada. … And it comes in from Canada and it comes in from Mexico, and that’s a very important thing to say,” said Trump, who is also imposing an additional 10% tariff on Chinese imports.
The U.S. president said in late January that he would impose tariffs on Mexican and Canadian imports for three reasons — because migrants have “poured into” the United States via its southern and northern borders, because large quantities of drugs have flowed into the U.S, and because of “the massive subsidies that we’re giving to Canada and to Mexico in the form of [trade] deficits.”
Just before the tariffs were due to take effect in early February, Sheinbaum and Trump reached a deal that postponed the tariffs for one month. The Mexican president won significant praise for negotiating the postponement agreement, under which she agreed to deploy 10,000 National Guard troops to Mexico’s northern border.
After Trump’s announcement on Monday, the Mexican peso weakened, and closed at 20.71 to the US dollar, according to the Bank of Mexico. Trump’s announcement also caused stock markets in the United States to tumble.
Some analysts, including Banco Base’s director of economic analysis Gabriela Siller, have warned that U.S. tariffs on Mexican exports will cause the Mexican economy to go into recession.
On Monday afternoon, Siller wrote on X that she didn’t believe that “general tariffs” would take effect on Tuesday.
“At the last minute” — i.e. sometime on Monday night — “Trump will decide to postpone them,” she wrote. “In the remote case they enter into force, they won’t last very long.”
On Monday morning, Sheinbaum said her government would wait “to see what happens” with regard to tariffs.
“In this, we have to have mettle, calmness and patience,” she said.
“And we have plan A, plan B, plan C, plan D,” the president said, indicating that her government was prepared for any eventuality.
Asked whether she could speak to Trump about tariffs before they are scheduled to take effect at midnight Tuesday, Sheinbaum said that “everything is possible.”
Last November, the president said Mexico would retaliate with its own reciprocal tariffs on U.S. goods if duties were imposed on Mexican exports. However, in more recent times she has been less forthcoming about how Mexico would respond to tariffs imposed by its largest trade partner. Instead Sheinbaum has favored a wait-and-see approach.
As of 4:30 p.m. Mexico City time, the Mexican government hadn’t announced any intention to impose tariffs on United States imports in retaliation for the duties on its exports. For its part, Canada already has a plan to implement tariffs on imports from the U.S. Canadian Foreign Affairs Minister Melanie Joly said Monday that plan remains in place.
On Sunday, United States Commerce Secretary Howard Lutnick questioned the wisdom of Mexico and Canada retaliating against the U.S. with their own tariffs.
“If they think they’re going to retaliate, remember they have so much more that they sell to us than we sell to them. It’s not even close. … This is not a battle we’re ever going to lose,” he said.
For months, the Mexican government has focused on pointing out that United States tariffs on Mexican exports would have a detrimental effect on the U.S. economy. Economy Minister Marcelo Ebrard has said that 25% tariffs would cause the loss of 400,000 jobs in the United States and increase prices for U.S. consumers.
The United States’ imposition of tariffs on its southern and northern neighbors will also violate the terms of the USMCA free trade pact, which superseded NAFTA in 2020.
Following Trump’s announcement on Monday, Jason Crow, a Democratic Party congressman from Colorado, sent a message to U.S. workers via his X account.
“The President just put 25% tariffs on Canada & Mexico. Prices on your fruits, vegetables, clothing, electronics, and more will go up. Your 401(k) savings are going down. Donald Trump is hurting working people,” he wrote.
Mexico News Daily
