Trump Pauses Some Tariffs on Mexico Amid Trade Tensions

Trump Pauses Some Tariffs on Mexico Amid Trade Tensions

(TJV)  President Donald Trump announced Thursday that he is temporarily halting certain tariffs on Mexican imports, citing ongoing trade negotiations and economic concerns, AFP reported.

The decision marks a partial reversal just a day after his administration offered temporary tariff relief to the auto industry.

Following a phone conversation with Mexican President Claudia Sheinbaum, Trump stated that the new tariffs on Mexico would not apply to trade covered under an existing regional agreement between the U.S., Mexico, and Canada.

The pause, he said, will last “until April 2nd,” at which point tariffs could still be imposed on some Mexican and Canadian goods.

“I did this as an accommodation, and out of respect for President Sheinbaum. Our relationship has been a very good one,” Trump wrote on Truth Social.

However, his approach to Canada remains far more confrontational.

Canadian Prime Minister Justin Trudeau responded to Trump’s move, stating that Canada would remain locked in a trade dispute with the U.S. “for the foreseeable future” despite temporary relief for certain industries.

“Our goal remains to get these tariffs, all tariffs, removed,” Trudeau said.

Markets have reacted negatively since Trump’s tariffs took effect earlier in the week, with economists warning that American consumers could face increased costs on a wide range of goods.

‘Economic Reality’

Trump’s decision to delay some tariffs reflects the economic disruption they have caused, according to trade analysts.

“It’s a recognition of economic reality,” said Scott Lincicome, vice president of general economics at the Cato Institute, in comments to AFP.

Lincicome noted that the rollback shows an understanding that tariffs disrupt supply chains, ultimately burdening consumers and injecting uncertainty into the market. However, the extent of relief for businesses will depend on the specifics of Trump’s policy adjustments.

Since returning to the White House in January, Trump has reignited trade wars with allies and rivals alike, making tariffs a central part of his foreign and economic policy.

He has justified tariffs on Mexico, Canada, and China as a means of curbing illegal immigration and fentanyl trafficking.

However, U.S. government data indicate that Canada contributes less than one percent of illicit fentanyl in the U.S., while illegal immigration from Canada remains minimal compared to flows from Mexico.

Meanwhile, China has rejected U.S. claims regarding its role in fentanyl trafficking, insisting that tariffs will not resolve the issue.

Economic Impact

U.S. Treasury Secretary Scott Bessent dismissed concerns that Trump’s tariffs would fuel inflation, suggesting any price increases would be temporary.

But economists warn that sweeping tariffs could slow U.S. economic growth and contribute to inflation in the short term.

Trump has repeatedly defended tariffs as a tool to generate revenue for the U.S. government and counter unfair trade practices.

However, government data released Thursday showed the U.S. trade deficit hit a record high in January, surging 34 percent to $131.4 billion. The increase was driven by a 10 percent jump in imports, as businesses rushed to secure goods ahead of potential new trade restrictions.

Analysts say gold imports played a role in the rising deficit, but even without that factor, imports climbed 5.5 percent—an indication that companies were “front-loading” shipments to avoid future tariff costs, according to Matthew Martin, a senior economist at Oxford Economics.

This trend suggests businesses are bracing for potential supply chain disruptions, even as Trump’s latest move temporarily eases tensions with Mexico.