Trump accepts to put customs rates on Mexico

Washington (AP) President Donald Trump on Monday accepted a 30-day break on his customs threats against Mexico and Canada, as America’s two largest trading partners took steps to reassure his concern over border security and drug trading.

The breaks give a cooling period after a swelling couple of days that put North America at the forefront of a trade war that risked crushing economic growth, causing prices to hover and end two of the US’s most critical partnerships.

“I am very pleased with this initial result and the tariffs announced on Saturday will be paused for a period of 30 days to see if a final financial agreement with Canada can be structured or not,” posted Trump posted Social media. “Fairness for everyone!”

Canadian Prime Minister Justin Trudeau posted Monday afternoon at X that the break would occur “while we work together” and said his government would name a fentanyl-Czar, indicate Mexican cartels as terrorist groups and launch a “Canada-US joint strike force To fight organized crime, fentanyl and money laundering.

The break followed a similar movement with Mexico, which allows for a period of negotiations on drug smuggling and illegal immigration. The 10% duty that Trump ordered in China is still ready to take effect as planned on Tuesday, although Trump planned to talk to Chinese President Xi Jinping for the next few days.

While the trade war feared by investors, businesses and political leaders now seem less likely to break out, that doesn’t mean the drama over Trump’s customs threats has ended. Canada and Mexico bought some extra time, but Trump could easily renew his tariffs and is already planning to advertise taxes on imports from the European Union.

All of this leaves the global economy uncertain whether a crisis has been averted or whether a possible disaster could still come in the coming weeks.

Trump on Saturday had instructed 25% duty on imports from Mexico and Canada with an additional 10% duty on Canadian oil, natural gas and electricity. The US president had repeatedly preview of these traits, yet they still managed to shock many investors, legislators, businesses and consumers.

Several analyzes of the Tax Foundation, Tax Policy Center and Peterson Institute for International Economics showed that the tariffs could hurt growth, lower incomes and push prices up. But Trump repeatedly insisted – despite promises of limiting inflation – that tariffs were needed tools to get other nations to stop illegal immigration, prevent fentanyl smuggling and treat the United States in his mind with respect.

Trump and Mexican President Claudia Sheinbaum announced the monthly break on increased tariffs against each other after what Trump described on social media as a “very friendly conversation” and he said he was looking forward to the upcoming conversations.

“I look forward to participating in these negotiations with President Sheinbaum as we try to achieve a” deal “between our two countries,” the president said on social media.

Trump said the negotiations would be led by Secretary of State Marco Rubio, Finance Minister Scott Bessent, trade secretary Howard Lutnick and high -level representatives of Mexico. Sheinbaum said she reinforced the border to 10,000 members of her country’s national guard and that the US government would commit to “working to stop trade in high -powered weapons to Mexico.”

In 2019, when Mexico’s government also avoided Customs from Trump’s administration, the government announced it would send 15,000 soldiers to its northern border.

But for large parts of Monday, the prospects were worryingly different for Canada, only for an appointment to get together.

A senior Canadian official said Canada was not convinced that it could avoid the threatening tariffs that Mexico did. That’s because Canada feels like the Trump administration has moved its requests from Canada more than it did for Mexico. The official spoke on condition of anonymity after he had not been authorized to speak in public.

When asked Monday afternoon what Canada could offer in conversations to prevent customs, Trump told journalists gathered in the oval office: “I don’t know.” He was thinking about trying to make Canada the 51st state, part of the ongoing antagonism despite decades of friendship with Canada in a partnership that has been from the World War II to the answer to the terrorist attacks on September 11.

The US president also stated that more import duties could come against China: “If we cannot enter into an agreement with China, tariffs will be very, very significant.”

The White House press secretary Karoline Leavitt told journalists that Trump would talk to Chinese President Xi Jinping for the next few days and that the White House would give a report on the discussion.

Financial markets, businesses and consumers on Monday still tried to prepare for the possibility of the new tariffs. Eg Norwegian salmon.

Stock markets sold a little, suggesting a hope that the import duties that could push inflation up and disrupt global trade and growth would be short -lived. Trump even asked Monday how the financial markets did when journalists left the oval office.

The situation reflected a deep uncertainty about a Republican president who has spoken to worship about customs and even to say that the US government made a mistake in 1913 by switching to income taxes as its primary source of income.

Kevin Hassett, director of the White House National Economic Council, said Monday it was misleading to characterize showdown as a trade war despite the planned retaliations and risk of escalation.

“Read the executive order where President Trump was absolutely 100% aware that this is not a trade war,” Hassett said. “This is a drug war.”

But even if the orders are focused on illegal drugs, Trump’s own remarks have often been more about his perceived feeling that abroad is ripping the United States by running trade surplus. On Sunday, Trump said duty would come soon to countries in the European Union.

On Monday afternoon, he suggested a willingness to continue using customs threats because the size of the US economy as the world’s largest made them effective.

“Tariffs are very powerful both financially and by getting everything else you want,” Trump told journalists. Tariffs for us no one can compete with us because we are the pot of gold. But if we do not continue to win and continue to cope, we will not be the pot of gold. “

___

Gillies reported from Toronto and Sánchez reported from Mexico City. Associated Press author Anne d’Ennols in New York contributed to this report.