Canada and Mexico announce retaliatory tariffs after the US imposed 25% import taxes on goods from the two countries, as well as a 10% tax on China
Canada's Prime Minister Justin Trudeau unveiled matching 25% tariffs on $155bn of US goods
Mexico's President Claudia Sheinbaum says she will also introduce retaliatory measures including tariffs on the US
Trump says the tariffs are being implemented in order to tackle the fentanyl crisis in the US
The tariffs on Canadian, Mexican and Chinese goods will come into effect from midnight on Tuesday, according to executive orders signed by Trump
Energy imports from Canada will have a lower 10% tariff, the White House says
China's ministry of commerce says the tariffs serve neither China, the US nor the world's interests
Watch: Canada's PM announces tariffs of 25% on US goods
Prime Minister Justin Trudeau will be speaking a little later than originally expected tonight.
He is now holding a press conference at 20:30 local time (01:30GMT).
He will be joined by Foreign Affairs Minister Mélanie Joly, Finance Minister Dominic LeBlanc, and Public Safety Minister David McGuinty, who have all been involved in recent discussions with US lawmakers on tariffs and border security.
Natalie Sherman
New York business reporter
It might seem in-the-weeds, but it’s worth understanding what legal authority President Donald Trump is citing in his tariffs announcement.
During his first term, he conducted trade fights citing rules that allowed tariffs as a response to unfair trade practices or national security concerns.
This time he has declared a national emergency, citing “illegal aliens and drugs” and using that authority to impose the tariffs.
This isn’t an obscure law – it’s often used to impose sanctions on countries like Russia or Venezuela.
But for tariffs, it’s unusual. And unlike the routes he used in the past, it allows the president to skip steps, like investigations and comment periods.
“It’s a pretty powerful statute and one which I think is maybe used in an unprecedented way to do this universal tariff,” trade lawyer Everett Eissenstat, who served as a White House economic adviser during Trump’s first term, told the BBC earlier this month as the idea was first being discussed.
Republican congressman Jason Smith, chair of the House Ways and Means Committee, has praised President Trump's tariff announcement.
"President Trump is delivering on his promise to take bold action to protect our communities, secure our borders, and bring in additional revenues to the federal government," he says in a statement.
The tariffs on China, Mexico, and Canada "send a powerful message that the United States will no longer stand by as other nations fail to halt the flow of illegal drugs and immigrants into our country."
Smith says tariffs must be used as a means to "defeat cartels and end the import of drugs", adding that such measures will also bring in "billions in new revenue to the U.S. government".
The Ways and Means Committee oversees US fiscal legislation, including taxes and tariffs.
Top Democrat Chuck Schumer, the party's minority leader in the Senate, has released a statement criticising President Donald Trump's tariff announcement and warns that such policies will make prices go up in the US.
“It would be nice if Donald Trump could start focusing on getting the prices down instead of making them go up," he says.
“All tariffs are not created equal. Donald Trump is aiming his new tariffs at Mexico, Canada, and China but they will likely hit Americans in their wallets. I am concerned these new tariffs will further drive up costs for American consumers."
"We should be focused on going hard against competitors who rig the game, like China, rather than attacking our allies," he adds.
We have just heard from Donald Trump after he signed an order imposing 25% tariffs on goods imported from Canada and Mexico and a 10% tax on China.
The president says he has implemented today's tariffs "because of the major threat of illegal aliens and deadly drugs killing our Citizens, including fentanyl".
"We need to protect Americans, and it is my duty as President to ensure the safety of all," he posted on Truth Social.
"I made a promise on my Campaign to stop the flood of illegal aliens and drugs from pouring across our Borders, and Americans overwhelmingly voted in favor of it."
"We don't need [Canada] to make our cars, we make a lot of them, we don't need their lumber because we have our own forests... we don't need their oil and gas, we have more than anybody," President Trump told global business leaders at the World Economic Forum last month.
So how much of those products does the US currently buy?
Canada’s top customer for its energy is the US, with crude oil imports reaching a record of 4.3 million barrels per day in July 2024, Energy Information Administration, external , external(EIA), external data shows., external Canada accounts for 52% of total US oil imports, according to the EIA.
The North American auto industry also has highly integrated supply chains. Auto parts can cross the borders between the US and Mexico and Canada multiple time before a vehicle is finally assembled.
The US also doesn’t produce enough lumber to meet demand at home. Canada sold the US C$8.4bn of softwood lumber products in 2020., external
Softwood lumber products, like pine, fir and spruce, are mainly used in the construction of family homes.
The trade dispute over Canada’s lumber has been going on for decades with the US, which argues Canada unfairly subsidises the industry by charging minimal fees to log public lands.
In January, Trump told a global business audience that Canada "can always become a state, and if you're a state, we won't have a deficit. We won't have to tariff you”.
The president also reiterated his assertion that the US has a trade deficit with Canada of between $200bn and $250bn (£161bn and £201bn). It's not clear where he got that figure.
The trade deficit with Canada - expected to be $45bn in 2024, according to an analysis by TD Bank, external - is mostly driven by US energy demands.
Jessica Murphy
BBC News, Toronto
As we wait for Prime Minister Trudeau's remarks this evening, here's what two top contenders in the race to replace him have said.
Mark Carney and Chrystia Freeland - both frontrunners in the race - back a forceful response to US tariffs.
Carney, the former central banker for the UK and Canada, told BBC's Newsnight on Friday that his country is ready to "stand up to a bully".
He said the country is ready to "match dollar for dollar the US tariffs".
Freeland, the former federal finance minister, also backs a dollar-for-dollar response.
She also supports an embargo on federal agencies buying US goods and barring American firms from bidding on government contracts.
Whoever wins the Liberal leadership race on 9 March will step into Trudeau's shoes as PM.
Read more about how Canada's possible response here.
Will Grant
Reporting from Mexico City
Image source, Getty ImagesAll week, the Mexican President, Claudia Sheinbaum, has been bullish about the threat of tariffs from the Trump Administration. She felt confident they wouldn't be imposed, she said, and if they were, her government had a "Plan A, a Plan B and a Plan C" to deal with the fallout. The exact nature of those contingency plans would be revealed at the time, she insisted.
Well, it seems that moment the US's neighbours in North America had hoped to avoid has arrived and Mexicans - both business leaders and ordinary citizens - are looking for President Sheinbaum to reveal her hand. Most expect her to follow through with retaliatory tariffs on US products as she repeatedly said Mexico would be forced to, in the lead up to this trade dispute.
Beyond that, President Trump has tied these tariffs to the issue of fentanyl trafficking. But her administration says that the Mexican military has done a great deal on the issue - including suffering numerous casualties. The side which needs to do more, she argues, is the United States, to work harder on the demand side as the world's biggest market for illegal drugs. And, crucially, stem the tide of illegal weapons heading south, from the US, into the arms of the Mexican cartels. The two sides remain far apart on that issue.
Still, with Mexico having recently replaced China as the US's biggest trading partner, the sums involved run into the hundreds of billions of dollars of cross-border trade each year. As such, there are real life consequences in Mexico for companies big and small in this trade spat, and Mexican diplomats will be hoping to bring it to as swift a conclusion as possible.
The Canadian Chamber of Commerce released a statement ahead of what it called Trump's "profoundly disturbing decision" on tariffs.
The statement says the tariffs will have "immediate and direct consequences on Canadian and American livelihoods" and will "drastically increase the cost of everything for everyone".
"Every day these tariffs are in place hurts families, communities, and businesses," the statements adds, saying that if Trump really wanted to bring the cost down for Americans, he would instead strengthen its ties with Canada.
"If we can’t trade south, let’s diversify our trading partners and dismantle unnecessary internal trade barriers to keep goods and services flowing north, east, and west. A strong, united, and competitive Canadian economy will thrive no matter what gets thrown our way," the statement says.
Image source, Getty ImagesCanadian Prime Minister Justin Trudeau is set to speak about the tariffs at 18:00 local time. You can watch his remarks by clicking "Watch Live" at the top of the page.
Michelle Fleury
BBC World News Correspondent
Image source, Getty ImagesHow far is the US willing to push its own economy just to get a dig in at others? That's the gamble being made right now.
The White house thinks it’s a pretty safe bet because, as it points out, trade is worth much less of the US’s overall GDP (24%) than of Mexico’s (73%), Canada’s (67%) and even China’s (37%).
Still, the tariffs could nudge prices higher for American consumers and businesses. And if foreign countries retaliate, the United States could see exports drop, which could slow growth.
When asked about this in the Oval Office on Friday, Trump conceded that some costs could be passed on to consumers.
"There could be some temporary short-term disruption, and people will understand that," he told reporters.
So the calculation the Trump administration and those who support import duties are making is this: With the sheer size of the American economy and its consumer base, the US can weather the storm of tariffs and whatever backlash comes with them.
In the last of five posts from the White House detailing reasons behind the tariffs, the White House accuses "the Fake News" of "already lying about the impact of tariffs."
"A 2024 study on the effects of President Trump’s tariffs during his first administration found that they “strengthened the U.S. economy” and “led to significant reshoring” in industries like manufacturing and steel production," the post on X says.
"Even former Biden Treasury Secretary Janet Yellen affirmed last year that tariffs do not harm consumers," the statement adds.
In another post on X, external, the White House states its tariffs aimed at China are also intended to address the US fentanyl crisis.
"President Trump is implementing a 10 percent tariff on China until we secure the full cooperation of the Chinese government in the fight against fentanyl," the post states. "China plays the central role in the fentanyl crisis that is destroying American lives."
The White House also alleges the Chinese Communist Party "actively helps this business."
The White House says additional tariffs on Canada will remain "until Canada cooperates with the US against drug traffickers and on border security".
"There is growing production of fentanyl in Canada, and enough fentanyl was seized at the northern border last fiscal year to kill 9.8 million Americans," a statement on X says.
"Additionally, illegal border crossings from Canada reached historic new highs every year for the last four fiscal years," the statement adds.
In a series of posts on X, the White House is laying out its justification for the tariffs.
"President Trump is implementing a 25 percent tariff to be paid for by Mexican producers until Mexico cooperates with the U.S. in the fight against drugs," one post reads., external
The White House writes that Mexican cartels are responsible for trafficking fentanyl, meth, and other drugs.
The administration hopes to use tariffs to compel the Mexican government to take more forceful action.
The White House has now confirmed President Trump is implementing a 25% tariff on imports from Canada and Mexico and a 10% additional tariff on imports from China.
"Today’s tariff announcement is necessary to hold China, Mexico, and Canada accountable for their promises to halt the flood of poisonous drugs into the United States," the White House says on X.
The order makes an exception for energy resources from Canada, which will have a lower 10% tariff.
President Trump has signed an order imposing 25% tariffs on goods imported from Canada and Mexico and a 10% tax on China, the White House has confirmed.
Energy imports from Canada will have a lower 10% tariff, a statement says.
“We don’t need their cars… I'd rather make them in Detroit.” So said the then-President-elect Donald Trump on 7 January, when asked about the US’s future trading relationship with Canada.
You won’t find a Canadian car brand on the roads, but around two million cars a year are made there domestically.
“About 1.6 million of those get exported to the US,” says Flavio Volpe of Canada’s Automative Parts Manufacturers' Association, adding that more than half of those cars are American. These include General Motors, Ford, Chrysler and Dodge.
He says that for the US to meet demand, it would have to build another 25 production plants - something that would take between 10 to 15 years and "probably bankrupt General Motors and Ford along the way”.
His message to Trump? “Grow up.”
Image source, Getty ImagesTrump has repeatedly linked his tariff policy to fentanyl, a deadly synthetic painkiller, getting into the US from Canada, Mexico and China.
“The fentanyl coming through Canada is massive,” Trump recently said.
There is an opioid overdose epidemic in the US and Canada, driven in part by the availability of fentanyl.
There has been a slight decrease in opioid deaths in recent months, but the epidemic claims around 80,000 lives a year in North America.
Both the northern and southern US borders have reported drug seizures, though amounts at the border with Canada are considerably lower than those with Mexico, according to official data.
US border agents seized 43lbs (19.5kg) of fentanyl at the northern border between October 2023 and last September, compared to more than 21,000lbs at the southern border.
Still, while less fentanyl crosses from Canada, recent reports from Canadian intelligence agencies suggest there is a growing number of organised crime groups manufacturing that and other drugs in the country.
Canadian law enforcement has reported fentanyl originating from Mexican organised crime groups in the Canadian drug supply, though the, external , external“magnitude, external and nature” of the operation isn’t clear., external