President Donald Trump has agreed to hold off imposing 25% tariffs on Canada and Mexico for 30 days, pulling the North American neighbours back from the brink of a potentially damaging trade war.
After last-minute calls with Trump, Canadian Prime Minister Justin Trudeau agreed to reinforce his country’s border with the US to clamp down on migration and the flow of the deadly drug fentanyl.
Earlier, Trump made a deal with Mexican President Claudia Sheinbaum. She agreed to reinforce the northern border with troops. In return the US would limit the flow of guns into Mexico.
But a US tariff of 10% on Chinese imports has come into effect, after a deadline of 00:01 EST (05:00 GMT) on Tuesday passed.
Shortly after, Beijing announced it was imposing retaliatory tariffs on a raft of American products, including 15% on coal and liquefied natural gas and 10% on crude oil and agricultural machinery.
Trump earlier said he planned to speak on the phone to his Chinese counterpart soon. He described the 10% import taxes as the “opening salvo” and said they could become “very, very substantial” if no agreement is made.
Monday’s breakthrough with Canada and Mexico came as they prepared retaliatory tariffs on American goods.
After two phone calls on Monday, Trump and Trudeau posted on social media that they had reached a temporary agreement on securing the border that would avoid tariffs for at least 30 days.
Both leaders portrayed the plan as a win.
Trudeau said Canada was implementing a $1.3bn (£1bn) border plan that included nearly 10,000 frontline workers and more resources to halt the flow of fentanyl, a synthetic drug 50 times stronger than heroin, which Trump has cited as a major concern.
The prime minister also said Canada would appoint a “fentanyl czar” and launch a joint strike force with the US to combat crime, fentanyl and money laundering.
Much of the border security plan had already been announced by Canada in December.
It includes enhanced co-ordination with US law enforcement, increased information sharing, limiting traffic at the border, and the deployment of drones and Black Hawk helicopters for surveillance.
The news came just hours after Trump paused a separate tariff on Mexican goods in exchange for that country sending 10,000 National Guard troops to its border with the US.
President Sheinbaum broke the news on X, writing she had had a “good conversation with great respect for our relationship and sovereignty” with her US counterpart.
Trump described his phone conversation with the Mexican leader as “very friendly”.
In 2019, Mexico’s government agreed to send 15,000 soldiers to its northern frontier to avoid tariffs from the first Trump administration.
