China and Canada announced retaliation steps against the US after Donald Trump imposed his plan to remove tariffs at midnight US time, despite warnings that it could spark a rising trade war.
U.S. tariffs began 25% against goods from Canada and Mexico, the two largest US trade partners, and 20% tariffs against China – the debt in China has doubled since last month.
The duties stand to affect more than $ 918bn worth of US imports from Canada and Mexico.
China said on Tuesday that it would impose fresh tariffs on a set of agricultural imports from the US next week. The financial ministry said an additional 15% tariffs would be imposed on chicken, wheat, corn and cotton, with an additional 10% sorghum tariffs, soybeans, pork, beef, aquatic products, fruits, vegetables and dairy products.
Asian markets fell on Tuesday as they opened, with Japan’s Nikkei index dropping more than two percent and Hong Kong’s Hang Seng dropped 1.5 percent.
Canada Prime Minister Justin Trudeau said Ottawa would respond with an immediate 25% tariffs on C $ 30BN ($ 20.7BN) worth of US imports. He previously said that Canada would target American beer, wine, bourbon, home appliances and Florida orange juice.
Tariffs will be placed in another C $ 125bn ($ 86.2bn) of US goods if Trump’s tariffs are still in the area in 21 days.
“The tariffs will interfere with an incredibly successful trade relationship,” Trudeau said, adding that they will violate the US-Mexico-Canada Free Trade Agreement signed by Trump in his first term.
Mexico president Claudia Sheinbaum, is expected to announce his response Tuesday morning, the country’s economic ministry said.
Trump and his allies claimed that higher tariffs on US imports from around the world would help regenerate America, by enabling it to gain political and economic concessions from allies and rivals at the global phase.
But businesses, within the US and around the world, warn of widespread disruption if the Trump administration is pushing ahead of this approach.
Since winning the election of the President of November, the president has been dedicated to China, Canada and Mexico, which threatens three markets with steep duties in their exports unless they have reduced the “unacceptable” level of illegal drugs crossing the US.
As he slapped a 10% tariff in China last month, Trump repeatedly delayed the imposition of tariffs in Canada and Mexico. The President has promised to drop prices in the US, but economists warned that consumers in the country could be affected by his trading plans.
A 25% tariff in Canada and Mexico and a 10% tariff in China costs the “biggest tax increase in at least one generation”, according to the Peterson Institute for International Economics, a Thinktank, who estimated such a move costs the usual US household more than $ 1,200 per year.
Trump has promised to go further, threatening to introduce “discussions” tariffs to countries with their own duties in goods made in the US. He said they would be effective as soon as the month.
