U.S. President Donald Trump makes an announcement about an investment from Taiwan Semiconductor Manufacturing Company (TSMC), in the Roosevelt Room at the White House in Washington, D.C., U.S., March 3, 2025.
Leah Millis | Reuters
President Donald Trump said that the U.S. will impose 25% tariffs on Canada and Mexico on Tuesday, scrapping hopes of a last-minute deal that would avoid stoking a trade war with America’s top trading partners.
Trump, speaking at the White House on Monday afternoon, said there was no room left to negotiate with the two U.S. allies.
“They’re all set. They go into effect tomorrow,” he said.
Stocks, already trading in the red, sank further following Trump’s comments.
Trump had signed an executive order imposing 25% tariffs on Mexico and many imports from Canada on Feb. 1. But he postponed those plans for a month on Feb. 3, after both U.S. neighbors pledged to take steps to address issues at their respective U.S. borders.
Trump confirmed last week that the paused tariffs on Mexico and Canada would go back into effect Tuesday, complaining that illicit drugs are still “pouring into our Country from Mexico and Canada at very high and unacceptable levels.” He also announced that an additional 10% tariff on Chinese imports would take effect the same day.
Earlier Monday, Commerce Secretary Howard Lutnick had suggested that while Trump would take executive actions on Tuesday, he might soften his tariff demands.
“He knows they’ve done a good job on the border. They haven’t done enough on fentanyl. Let’s see how the president weighs that today,” Lutnick said on CNN. “We’re going to talk about it all day today, and then he’ll let everybody know tomorrow with the plans.”
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