New Delhi: In a move that has sent shockwaves through global financial markets, U.S. President Donald Trump’s tariffs on imports from Canada and Mexico are set to take effect, marking a significant escalation in trade tensions. This development comes as Trump reaffirmed plans to increase tariffs on Chinese goods, citing Beijing’s failure to address fentanyl shipments to the U.S. The tariffs, which include a 25% duty on most Canadian and Mexican imports, have sparked fears of a broader trade war, with potential repercussions for the highly integrated North American economy.
The U.S. stock market reacted sharply to the news, with the Dow Jones Industrial Average plummeting 649.67 points and the S&P 500 losing 104.78 points. The impact was also felt in Asian markets, where Tokyo’s Nikkei 225 index fell by 2.43%. Indian benchmarks opened lower, reflecting the global trend.
Trump’s stance on tariffs has been consistent, viewing them as a tool to correct trade imbalances. However, critics argue that these measures could lead to economic damage and higher inflation. The Canadian and Mexican governments have signaled readiness to retaliate, with Ontario Premier Doug Ford warning of severe economic consequences for both countries.
China, too, has prepared countermeasures, likely targeting U.S. agricultural products. The situation has heightened concerns about the global economy’s stability, with some analysts warning of a potential recession.
Trump on Tariffs: “They’re going to have to have a tariff. So what they have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs,” Trump said.
Gustavo Flores-Macias, Cornell University: “The automobile sector, in particular, is likely to see considerable negative consequences, not only because of the disruption of the supply chains but also because of the expected increase in the price of vehicles.”
The tariffs have raised alarms about rising geopolitical tensions and the potential for further trade retaliation. Automaker shares have been particularly affected, with General Motors and Ford experiencing significant declines. The broader economic impact is expected to be substantial, with concerns over inflation and global economic stability.
