TMTPOST -- The Canadian government is going to pause its next wave of retaliatory tariffs after U.S. President Donald Trump suggested more room to negotiate with a one-month exemption from tariffs on certain imports tied to the United States-Mexico-Canada Agreement (USMCA).
Credit：China Central Television
“Canada will not proceed with the second wave of tariffs on $125B of U.S. products until April 2nd, while we continue to work for the removal of all tariffs,” Canadian Finance Minister Dominic LeBlanc announced in a post on X on Thursday. The minister cited Trump’s latest move to pause U.S. additional tariffs on imports from Canada compliant to USMCA. USMCA is a trade agreement that Trump's first administration negotiated to replace the decades-old North American Free Trade Agreement.
Trump said earlier Thursday he will suspend tariffs on Mexican goods that fall under USMCA until April 2 after he held a call with Mexican President Claudia Shenbaum. “After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay Tariffs on anything that falls under the USMCA Agreement,” Trump posted on his social media Truth Social. “This Agreement is until April 2nd.”
Hours later, Trump signed executive actions to grant temporary exemptions from tariffs imposed on Canadian and Mexican imports that are covered by the USMCA until April 2, effectively delaying the extra 25% tariffs that just entered effect on Tuesday for almost a month.
April 2 is the date that Trump plans to implement reciprocal tariffs on major U.S. trading partners. About 50% of Mexican imports and 38% of Canadian imports are covered by the USMCA, CNBC cited a White House official.
In response to Trump’s pause order, Sheinbaumwill said her government and U.S. will continue to work together, particularly on migration and security issues, which include reducing the illegal crossing of fentanyl into the United States, as well as weapons into Mexico. She believed Mexico should be spared when reciprocal tariffs are set to come into effect on April 2.
Sheinbaumwill said Trump told her there are countries that have very high tariffs on U.S. products, which is unfair. “In Mexico’s case, almost everything is without tariffs. We don’t charge them tariffs, and they don’t charge us tariffs,” the president said at a news conference.
U.S. Commerce Secretary Howard Lutnick previewed the pause earlier Thursday. He said in a CNBC interview that the one-month exemption from tariffs could be expanded into all goods and services that are compliant with USMCA. “It’s likely that it will cover all USMCA compliant goods and services, so that which is part of President Trump’s deal with Canada and Mexico are likely to get an exemption from these tariffs,” said Lutnick, adding that “the reprieve is for one month.” Lutnick indicated Canada and Mexico might only be subjected to reciprocal tariffs on April 2 if they have done good enough on fighting fentanyl.
Prior to Trump’s temporary tariffs pause, Canadian Prime Minister Justin Trudeau said his government discussed about possible delay of a second wave of retaliatory tariffs, while insisted Ottawa would not remove all the countermeasures following U.S. extra tariffs unless the Trump administration dose.
“We will not suspend Canadian tariffs because the American made a change yesterday,” he said. “As I said a number of times we will not be backing down from our response tariffs until such a time as the unjustified American tariffs on Canadian goods are lifted.”
The Trump administration’s 25% additional tariffs on products imported from Canada and Mexico took effect on Tuesday, with the exception of a 10% levy on Canadian oil, and levy of 10% on imports from China effective the same day, making extra tariffs on China doubled to 20% since Trump returned to White House. China and Canada immediately retaliated with their duties on certain U.S. exports, while Mexico said it would deliver its response on Sunday.
The Canadian government said on Tuesday it moved forward 25% retaliatory tariffs on imported goods, beginning immediately with a list of goods worth 30 billion Canadian dollars the same day. The scope of the Canadian counter tariffs will be increased to $155 billion Canadian dollars if the current U.S. tariffs are maintained, and the scope could also be increased if new tariffs are imposed.
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