Trump says China to face added 10% tariff starting in March

WASHINGTON, FEBRUARY 28 : Donald Trump has announced that he would impose an additional 10 percent tariff on Chinese imports, while also moving forward with tariffs on Canada and Mexico next week, citing what he described as "unacceptable" drug smuggling. This announcement made yesterday followed global market losses, as his comments raised concerns about the potential for a global trade war.

Earlier this month, Trump had proposed, then paused, a 25 percent tariff on Canadian and Mexican imports, citing concerns over illegal immigration and the deadly fentanyl epidemic, with Canadian energy products facing a lower tariff rate. However, the month-long pause is set to end on Tuesday.

In response to questions from reporters about whether the tariffs would proceed next week, Trump stated on social media that as long as the problem of fentanyl continues or "is seriously limited," the proposed tariffs would go ahead as planned, starting on March 4. He also confirmed that China would face an additional 10 percent tariff on that date. Earlier in February, Trump had already imposed a 10 percent tariff on Chinese imports, which prompted retaliatory measures from Beijing.

A US official confirmed that the new 10 percent tariff on China is in addition to the existing tariff related to fentanyl, noting that there has been "insufficient progress" on addressing the drug issue. The official emphasized that the US needed to take action against all three countries to tackle the fentanyl problem.

In response, Chinese Commerce Minister Wang Wentao expressed concerns over the new tariff, reaffirming China's firm opposition and its intention to take countermeasures. Wang also urged the US to resolve their differences through dialogue. Mexico’s President, Claudia Sheinbaum, expressed hopes of speaking with Trump to avoid the imposition of tariffs, and a high-level Mexican delegation was in Washington seeking an agreement. Canadian Prime Minister Justin Trudeau stated that Canadian officials were working tirelessly to avoid the tariffs but would respond "immediately" if they were imposed. Trudeau also pointed out that less than one percent of fentanyl and undocumented migrants entering the United States come from Canada.

Trump’s threats have shaken major exporting countries, with Asian markets showing significant declines early on Friday, with Tokyo’s stock market briefly dropping by 3 percent.

In addition to the fentanyl-related tariffs, Trump reaffirmed that the reciprocal tariffs set for April 2 would remain in effect. These tariffs will be tailored to each US trading partner, with further details to come after government agencies complete trade-related studies that Trump has called for.

In his letter to US Trade Representative Jamieson Greer, Wang noted that Trump had previously initiated several trade investigations targeting China and urged both sides to resolve their disputes through dialogue. Beijing has pushed back against the US's focus on fentanyl, asserting that the US should address the issue domestically rather than using tariffs as a means of pressure. A Congressional Research Service report from last year highlighted that fentanyl entering the US is primarily produced in Mexico using chemical precursors from China. While some of these chemicals are under international controls, others are legally made and exported from China.

Earlier in February, China’s foreign ministry warned that additional tariffs could negatively impact cooperation between the US and China in combating narcotics.

AFP