President Donald Trump has signed an order to impose 25 percent tariffs on goods from Canada and Mexico and an additional 10 percent levy on goods from China.
Trump said the tariffs were imposed via the International Emergency Economic Powers Act “because of the major threat of illegal aliens and deadly drugs killing our citizens, including fentanyl.
“We need to protect Americans, and it is my duty as President to ensure the safety of all. I made a promise on my Campaign to stop the flood of illegal aliens and drugs from pouring across our Borders, and Americans overwhelmingly voted in favor of it,” Trump posted on Truth Social after signing the order Saturday evening.
The White House noted in a statement that “Fentanyl is the leading cause of death for Americans ages 18 to 45.”
“Today’s tariff announcement is necessary to hold China, Mexico, and Canada accountable for their promises to halt the flood of poisonous drugs into the United States,” the White House said on Saturday evening.
After weeks of speculating, the White House imposed the taxes in retaliation for “the illegal fentanyl that they have sourced and allowed to distribute into our country,” said Trump’s press secretary Karoline Leavitt.
“These are promises made and promises kept by the president,” Leavitt said at a Jan. 31 press conference.
Trump also said the levies were needed because of the sizable trade deficit between the United States and Canada. While the president estimated the gap to be $200 billion, recent U.S. Census Bureau data suggest the trade deficit with Canada was $55 billion in the first 11 months of 2024.
If they remain in place, the president’s tariffs will affect approximately $1.6 trillion in annual trade between the North American countries, including crude oil.
The United States imports about 4.5 million barrels of oil daily from Canada. President Trump told reporters that he will “probably” lower crude tariffs to 10 percent.
Sunderesh Heragu, a researcher and educator at Oklahoma State University, says gasoline prices could have the most notable impact, as the United States imports a lot of crude oil from its North American neighbors.
“Twenty percent of the oil from Canada gets processed by the U.S. refineries, so when that supply is cut, then you’re going to see at least 20 percent, maybe more, less gas at the pumps,” Heragu. “That’s going to impact the prices significantly.”
According to the American Automobile Association, the national average price for a gallon of gasoline is $3.11 on Jan. 31.
Canadian Prime Minister Justin Trudeau, speaking at an event in Toronto on Jan. 31, announced that Ottawa will deliver a “purposeful, forceful but reasonable, immediate” response to U.S. tariffs.
The outgoing prime minister acknowledged that Canada “could be facing difficult times in the coming days and weeks,” but all three levels of government will support Canadians.
Conservative leader Pierre Poilievre and New Democratic Party chief Jagmeet Singh requested Parliament to be recalled. Prime Minister Trudeau prorogued Parliament until the Liberal Party selected a new leader to replace him.
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