US President Donald Trump administration imposes tariffs has officially imposed a 25% tariff on goods imported from Canada and Mexico and a 20% tariff on goods imported from China. The move is part of Trump’s “America First” policy, which aims to protect US industries and reduce the trade deficit. However, this policy can affect international trade relations and potentially impact the global economy.
Reason and purpose of tariffs
President Trump has long argued that the US is falling victim to unfair trade agreements with other countries. He believes that the US trade deficit with Canada, Mexico and China is too high, and it is harmful to American manufacturers and workers. Through this tariff, the Trump administration is trying to encourage domestic industries and reduce dependence on imports.
Effect of 25% tariff on Canada and Mexico
Canada and Mexico are among the largest trading partners of the US. Both these countries export large quantities of steel, aluminum, automobiles and other industrial goods to the US. A 25% tariff could cause the prices of these goods to rise, causing US consumers to pay more.
In addition, trade relations with these countries could become strained and they could also impose retaliatory tariffs.
Effect of 20% tariff on China
The purpose of imposing a 20% tariff on China is to reduce the competitiveness of Chinese products in the US market. The US has a huge trade deficit with China, and the Trump administration wants to reduce it. However, this tariff will also affect US companies, as they import cheap raw materials and products from China. This could increase the production costs of US companies, which will be reflected in consumers.
International response and possible consequences
Canada, Mexico and China have opposed these tariffs and warned of possible retaliation. This could lead to a trade war, which could disrupt global supply chains. US farmers, automakers and other industries are also likely to suffer losses.
However, the Trump administration claims that this policy will be beneficial for the US economy in the long term. Now it remains to be seen what the actual impact of these tariffs is and whether it proves beneficial for American industries or not.
