Donald Trump (left), Justin Trudeau (center) and Claudia Sheinbaum (right) File photo: AFP
US President Donald Trump has suspended tariffs on imported goods from Mexico and Canada for 30 days. Trump made this announcement after continuing last-minute negotiations with the two neighboring countries.
Trump can show this as a ‘victory’ in terms of border facilities and combating crime through force. On the other hand, Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau can also call it their ‘political victory’.
In any case, Trump has temporarily suspended the trade war that has temporarily shaken North America and the rest of the world economically.
Who benefits and who loses in this situation? What can happen next? These questions have come to the fore.
Trump’s strategy is successful
The BBC’s Courtney Subramaniam in Washington DC says Trump’s diplomatic efforts at a bitter rift with close trading partners appear to be paying off. Both Mexico and Canada have agreed to strengthen security at their border with the US, while also agreeing to take greater steps to crack down on illegal immigration and the trafficking of dangerous drugs such as fentanyl.
The strategy of using the economy to pressure other countries is a victory for Trump’s “America First” policy. It gives him a great opportunity to address key domestic issues without making US consumers feel the economic consequences of a continental trade war.
Trump’s tariff policy is nothing new, however. Mexico, Canada and the European Union (EU) reacted strongly to tariffs on steel and aluminium during Trump’s first term. However, economists say the measures have been limited in scope.
Trump has now threatened to impose massive tariffs on Mexican, Canadian and Chinese goods. Starting at midnight on Tuesday, local time, an additional 10 percent tariff on Chinese goods is set to be imposed. The 25 percent tariff on Canadian and Mexican goods has been suspended for 30 days.
But it is not yet clear whether Trump will reimpose the tariff threat on Canada and Mexico after the 30-day period. Such uncertainty raises concerns that these businesses could lose their reliance on the US market. At the same time, investment in new factory construction and hiring could be halted. At least until trade uncertainty becomes clearer.
How did Trudeau handle it?
The 30-day suspension of tariffs has brought relief to Canadian politicians and business leaders. Although the threat of tariffs remains, Canadian Prime Minister Justin Trudeau can claim it as a political victory.
Canadian politicians have struggled to convince Trump on this issue. Because the domestic political situation in Canada is not conducive to dealing with this situation. The role of Prime Minister Justin Trudeau in the last weeks of his term is also not very strong.
Canada announced measures on border security on Monday. Although these are not new measures.
Last December, Canada announced funding of 1.3 billion Canadian dollars. It has been said that the money will be used to disrupt the trafficking of drugs such as fentanyl, new law enforcement equipment and increase coordination with US law enforcement agencies.
Canadian surveillance drones and two Black Hawk helicopters have already begun patrolling the border between the two countries. Recalling these initiatives that have been underway for weeks, officials say Canada has taken Trump’s border concerns seriously.
‘Mexico’s Sheinbaum bought himself time’
Mexican President Claudia Sheinbaum has called for “cool heads” and “calm” during the trade crisis.
Even last Friday, Claudia Sheinbaum said she believed Trump would back down at the last minute from his decision to impose a 25 percent tariff on Mexican goods. After a phone call with Trump, Sheinbaum’s words came true.
Sheinbaum was seen smiling after the agreement was announced. Her supporters are seeing it as a “masterclass” in diplomatic efforts with Donald Trump.
Sheinbaum has agreed to deploy National Guard members to the border to focus on preventing fentanyl trafficking. But she has also strategically confirmed what she wants from Trump.
In addition to temporarily suspending the tariff, Trump has been able to fulfill his promise to do more to stop the smuggling of high-powered weapons from the United States into Mexico.
In addition, the Mexican president has had time to deal with the situation.
It is now expected that US Secretary of State Marco Rubio will visit Mexico soon to discuss these issues in detail. At the same time, a joint team of Mexican and US health and safety officials will be formed to deal with the trafficking of fentanyl.
In fact, Claudia Sheinbaum has managed to prevent a wider trade conflict between the two countries for the time being. This will be marked as the first “significant victory” of her new government. She took office as president of Mexico last October.
This situation will create an atmosphere for future dialogue between Trump and the Mexican president-led administration.
