Trump trade war intensifies as tariffs go into place

Americans awoke Tuesday morning to an intensifying trade war, as President Trump’s newest tariffs on Canadian, Mexican and Chinese imports were imposed and those countries quickly moved to retaliate.

The Trump administration imposed 25 percent tariffs on most imports from Canada and Mexico and a new 10 percent tariff on imports from China.

In retaliation, Canada hit the U.S. with 25 percent tariffs on $30 billion in goods just after midnight, though it did not specify which products were included.

“Our tariffs will remain in place until the U.S. trade action is withdrawn, and should U.S. tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures,” Canadian Prime Minister Justin Trudeau said late Monday in a statement.

“While we urge the U.S. administration to reconsider their tariffs, Canada remains firm in standing up for our economy, our jobs, our workers, and for a fair deal,” the outgoing Canadian leader added.

Mexico is expected to announce tariffs on U.S. products later Tuesday.

China said it would impose 15 percent tariffs on imports of chicken, wheat, corn and cotton from the U.S., as well as 10 percent tariffs on imports of sorghum, soybeans, pork, beef, seafoods, fruits vegetables and dairy products, according to The Associated Press.

Also Tuesday, Beijing added 15 U.S. companies to its unreliable entities list, which could potentially bar them from engaging in China-related import or export activities and from making new investments in the country.

“China has decided to include 15 U.S. entities that endanger China’s national security and interests in the export control list, prohibiting the export of dual-use items to them,” China's Commerce Ministry said in a statement.

Trump had threatened but then pulled back from tariffs previously, but in this case followed through with his vows despite a severely negative reaction from stock markets.

The S&P 500 dipped by 1.76 percent Monday, the biggest loss since December of last year. The Dow Jones fell by nearly 650 points, and the Nasdaq Composite was down 2.64 percent as Nvidia stock dropped by nearly 9 percent.

Ford and General Motors’ stocks also fell Monday.

The president is set to address a joint session of Congress on Tuesday evening, when he will be expected to defend his trade actions.

Trump said Monday that “vast amounts of fentanyl got poured into our country” mostly through Mexico and from China and suggested car manufacturers build factories in the U.S. to successfully sidestep the levies.

“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,” he added.

In hitting Canada and Mexico with tariffs, Trump has argued he is both seeking to crack down on fentanyl illegally entering the country and seeking to make fair a trade system he says penalizes the United States.

But Canada and Mexico argue they are taking steps to prevent illegal drugs from crossing the border and that Trump’s actions punish longtime U.S. allies even as they violate previous trade deals.

It is unclear where the trade war will head next, though Ontario Premier Doug Ford said Monday he is prepared to cut off electricity exports to the U.S. if Trump's 25 percent tariffs on Canadian goods go through.

“If they want to try to annihilate Ontario, I will do everything — including cut off their energy with a smile on my face,” Ford told reporters at a mining convention in downtown Toronto, the Toronto Sun reported.

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