US President-elect Donald Trump has said that China, Canada and Mexico will face new tariffs to combat illegal drugs trafficking as soon as his administration takes office.
On his social network platform Truth Social, he posted that 25% tariffs would be imposed on all imports from Mexico and Canada from 20th January.
The trade tariff threats involving Mexico and Canada would appear to run counter to the existing free trade aggreement that covers North America (US, Canada and Mexico) and to which the US is signed up to. Cross border trade of vehicles and parts across the three countries is at the centre of auto industry supply chains across the region.
Further, he also said that all imports from China would attract a 10% tariff until it cracked down on fentanyl smuggling.
Trump’s latest remarks are bound to boost trade tensions and concerns over the possibility of trade wars – via tit-for-tat tariffs and other measures – that curtail international trade flows and dent the global economy. Automotive trade – both vehicles and parts – would likely be the centre of international trade tensions because of its high value and volume.
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