What Effects Will Trump’s New Tariffs Have on Trade?

It’s official. On February 1, US President Donald Trump introduced a sweeping set of new 25% tariffs on imports from Canada and Mexico. China will also face new tariffs of 10%.

During the presidential campaign, Trump threatened tariffs against all three countries, claiming they weren’t doing enough to prevent an influx of “drugs, in particular fentanyl” into the US, while also accusing Canada and Mexico of not doing enough to stop “illegal aliens”.

There will be some nuance. On Friday, Trump said tariffs on oil and gas would come into effect later, on February 18, and that Canadian oil would likely face a lower tariff of 10%.

This may only be the first move against China. Trump has previously threatened the country with 60% tariffs, asserting this will bring jobs back to America.

But the US’ move against its neighbors will have an almost immediate impact on the three countries involved and the landscape of North American trade. It marks the beginning of what could be a radical reshaping of international trade and political governance around the world.

What Trump wants from Canada and Mexico

While border security and drug trade concerns are the official rationale for this move, Trump’s tariffs have broader motivations.

The first one is protectionist. In all his presidential campaigning, Trump portrayed himself as a champion of US workers. Back in October, he said tariff was “the most beautiful word in the dictionary.”

Trump hasn’t hidden his fondness for protectionist trade measures. This reflects the ongoing scepticism toward international trade that Trum…