Canadian Prime Minister Justin Trudeau fought back as US President Donald Trump wiped out 25% tariffs on imports from Mexico and Canada.
Even before the tariffs actually came into effect, Trudeau issued a statement calling the tariffs “unjust” and imposed immediate retaliation tariffs. Hours later, he attended a press conference Tuesday morning, where he called Trump “Donald,” calling tariffs “very stupid,” and accusing the US president of trying to cripple the Canadian economy and annex the country.
In contrast, Mexican President Claudia Sinbaum’s first comment came only at a press conference on Tuesday. She pledged to defend Mexico’s interests and announced tariffs on US imports. However, unlike Canada, Mexico’s The-for-Tat tariffs will only come into effect on Sundays, giving them time to do business with the US.
On Thursday, Sinbaum will be speaking to Trump to try and strive to piece together a compromise despite the US president’s release with Trudeau.
So why is Mexican presidents so different to Trump’s tariffs than the way Canada and Trudeau handle them? How does Mexico respond to Sheinbaum’s strategy? How did you get here? And what is at risk?
What is Trump’s tariffs and what is his legitimacy?
Even before he took office for the second time in January, Trump announced he would impose a 25% tariff on all goods from Canada and Mexico, citing concerns about border security and drug trafficking, particularly regarding fentanyl flows to the United States.
The US is the world’s second largest commodity trader after China, and Trump’s tariffs are rattling global markets.
These tariffs were originally scheduled to come into effect on February 4th, but negotiations between Trump and Canada and Mexican leaders led the US to postpone the one-month levies.
In these negotiations, Trudeau and Shanebaum agreed to strengthen border security to prevent drug trafficking and immigrants entering the United States.
Trudeau appointed “Emperor Fentanyl” to tackle the issue. Shainbaum deployed 10,000 additional soldiers at the US-Mexico border to curb irregular immigration. Within Mexico, her law enforcement broke fentanyl gangs, attacked labs and arrested them. Last week, Mexico sent 29 drug cartel leaders to the United States to prosecute.
Still, on Tuesday, Trump enacted a 25% tariff, affecting a wide range of products. Additional tariffs were also imposed on China.
The top three US trading partners, Mexico, Canada and China, account for more than 35% of the goods imported or exported by the world’s largest economy.
How did Canada respond?
Canada responded swiftly and assertively to US tariffs, which it first announced on February 1, with its own retaliatory protectionist measures.
Starting Tuesday, Canada has imposed a 25% tariff on US goods worth $21 billion.
Trudeau warned that Canada would not “retreat from the fight” and that tariffs would remain in place until US tariffs are withdrawn.
Products such as meat, grain, certain alcohol, clothing, footwear, footwear, motorcycles and cosmetics are just a few of the US products subject to immediate duties, according to the Canadian Treasury.
Some Canadian provinces have taken their own steps, ordering the removal of all US liquor from stores, for example.
Trudeau appears to be in favor of Canadians who have boycotted American merchandise at sporting events and opted to boo the US national anthem in comments Tuesday.
Trudeau called out Trump on Wednesday, but said the US president ended up with a “somewhat friendly” memo, but later accused Canada of allowing fentanyl to enter the United States.
How did Mexico respond?
While Trump and Trudeau have exchanged passionate personal comments over the past few weeks, Shanebaum has taken a more measured approach.
In comments Tuesday, Sinbaum expressed his intention to implement “tax and non-tax measures” to protect Mexico’s interests, but refrained from immediate action and suggested that she intends to first drain all diplomatic channels.
“All I can say to you is that this is a very defining moment for Mexico… there is no submission. Mexico is a great country, and the Mexicans are brave and resistant,” she said.
As tariffs continue, Mexico will “reach out to Canada and other countries,” Sinbaum said. She added that Mexico could seek out other trading partners outside the US and shift their trade partnerships “if necessary.”
What lies behind Sheinbaum’s relatively measured approach?
During a briefing with a reporter in early February, Sinbaum provided insight into her thinking, saying Mexico needs to maintain a “cool head” amid threats from Trump.
This careful strategy reflects the great reliance on the US as a Mexican market. With over 75% of Mexico’s exports being sent to neighbors in the north, the dramatic disruption in that equation could suck up the country’s economy. Last year, the US imported $55.8 billion in goods from Mexico, exported $334 million, bringing the trade deficit to $171.8 billion.
Certainly Canada needs the US to export. Over 70% of Canada’s exports are sent to the US.
But the context of Trump’s tariffs in Mexico and Canada is completely different, Vina Najibla, vice president of research and strategy at the Asia-Pacific Foundation in Canada, told Al Jazeera.
Trump has discussed the idea of bombing Mexican drug cartels in the past, many of which have been designated by his administration as a “terrorist” organization, but he is more direct in search of Canadian territory.
Trump frequently says that his north neighbor should be the 51st US state, and he repeatedly mentioned Trudeau on Wednesday, including a call as governor rather than prime minister.
“In Canada, Trudeau pointed out that Trump’s actions were intended to cripple the Canadian economy and pave the way for a final annexation beyond a mere trade war,” Najibla said of Trump’s repeated threats to absorb Canada.
“It’s an existential battle for Canada’s sovereignty, so there’s a strong incentive to push back quickly,” she said.
Commenting on the new tariffs, Trudeau said on Tuesday that Trump is “planning to cause a complete collapse of the Canadian economy.
“The retaliation here isn’t just Tatt’s tariffs, it’s defending the country’s independence,” Najibla said.
Meanwhile, Trump says he respects Shanebaum. This is what the Mexican president mentioned while she said she respected the President of the United States.
Some of the Shainbaums aren’t Trudeau. It’s time.
Canada is quickly approaching national elections, with Trudeau’s liberals catching up. After tracking the opposition Conservative Party in double digits for over a year, the country’s governing party began to rapidly close the gap as Trudeau was pushed back to Trump’s move and the US president’s steps blew a wave of patriotism among Canadians.
Meanwhile, Sheinbaum was appointed only in October and is extremely popular. In two polls in February, her approval rates were 80% and 85%.
Is Sheinbaum’s approach working?
It’s too early to say.
However, on Wednesday, the Trump administration exempted carmakers from 25% tariffs for a month. The sector’s supply chains are spread across North America, but Mexico is the biggest beneficiary of grace. Cars, trucks, other vehicles and auto parts account for 27% of exports to the US. For Canada, that figure is 13%.
And Shanebaum enjoys more than the popular support in Mexico. Trump and her approach to tariffs also seem to have confidence in Mexican investors.
IPC, the country’s leading index of stock exchanges, has grown by 6% since the start of the year. In contrast, the Canadian Stock Exchange benchmark S&P/TSX is almost the beginning of the year.
What’s next?
If tariffs and retaliation measures taken by US neighbors continue, businesses will export goods and services, and consumers will pay higher prices. There could be a recession in some or all of the three North American countries.
When tensions boil, there are indications that the US administration will consider revising its position. Reports from the US suggest that Trump is open to lowering 25% tariffs on goods from Canada and Mexico.
However, if Trump decides to escalate, Najibla said “the damage to trust is already substantial.”
“We’ve seen him continue to threaten new tariffs in April and change his targets, and that level of unpredictability erodes trust between allies and trading partners,” she said.
The tariffs could also affect negotiations on the renewal of the US-Mexico-Canada Agreement (USMCA), a free trade agreement that came into effect in 2020, and were negotiated by Trump’s team in place of the 1994 North American Free Trade Agreement.
“How do you negotiate a stable contract if one party is consistently changing rules or imposing new tariffs without warning?” Najibla asked.
“Even if some tariffs are lifted or eased, the bigger problem is that Canada and others now view the US as a less reliable trading partner,” she added.