Canada and Mexico retaliate against Trump’s tariffs, escalating trade war

Canada and Mexico have announced retaliatory tariffs on U.S. goods after former President Donald Trump imposed sweeping tariffs on imports from both countries, along with China. 

Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum responded swiftly to Trump’s decision to levy 25% tariffs on Canadian and Mexican imports and 10% on Chinese goods. Trudeau declared Canada would counter with 25% tariffs on $155 billion worth of American products, including alcohol, furniture, and orange juice. Additionally, he urged Canadians to avoid purchasing U.S. products or vacationing in the United States, Caliber.Az reports via foreign media.

Local authorities in Ontario, British Columbia, and Nova Scotia moved to enforce the retaliatory measures by removing American liquor brands from government-controlled shelves. Ontario Premier Doug Ford announced that the Liquor Control Board of Ontario (LCBO), the province’s primary alcohol wholesaler, would cease selling American products, preventing restaurants and retailers from restocking them.

Meanwhile, Mexico’s response has been less detailed, with Sheinbaum’s government confirming retaliatory tariffs without specifying rates or targeted products. Mexico's official stance had been cautious, but allegations from the U.S. regarding criminal alliances with her administration forced a more assertive reaction. Sheinbaum criticised U.S. policies, calling for Washington to address its own issues related to drugs and gun control rather than interfering in Mexican affairs.

The economic impact of the tariffs is already generating concern. In Mexico, business leaders warn of job losses in border assembly plants, which employ large numbers of workers. Economist Gabriela Siller cautioned that the tariffs could lead to an economic crisis in Mexico, increasing unemployment and triggering price hikes.

Tensions between the countries extend beyond trade, as Trump cited illegal immigration and drug trafficking as reasons for the tariffs. The former U.S. president threatened to increase levies further if Canada and Mexico retaliated, a provision Mexican analysts called a “retaliation clause” designed to pressure both nations into compliance.

Diplomatic experts see the situation as unprecedented. Martha Bárcena, former Mexican ambassador to the U.S., warned that the tariffs signal a fundamental breakdown in trust between the countries and could have national security implications.

The timing of the trade war is also politically sensitive, particularly in Canada, where Trudeau’s Liberal Party is heading into an election cycle. Mark Carney, a leading candidate to replace Trudeau, condemned Trump’s tariffs, calling them “a clear violation of trade agreements” and vowing that “Canada will not bow down to a bully.”

By Vugar Khalilov