finance

Trump announces tariffs on Mexico until 'immigration problem remedied'


In a surprise announcement that could compromise a major trade deal, Donald Trump announced Thursday that he is slapping a 5% tariff on all Mexican imports to pressure the country to do more to crack down on the surge of Central American migrants trying to cross the border.

He said the percentage would gradually increase “until the Illegal Immigration problem is remedied”.

Trump made the announcement by tweet after telling reporters earlier Thursday that he was planning “a major statement” that would be his “biggest” so far on the border.

“On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,” he wrote, “at which time the Tariffs will be removed.”

Trump has accused the Mexican government of failing to do enough to crack down on the surge of Central American migrants who have been flowing to the US in search of asylum from countries including El Salvador, Honduras and Guatemala.

The announcement comes as the administration has been pushing for passage of the United States-Mexico-Canada Agreement that would update the North American Free Trade Agreement.

The White House said Trump would be using the International Emergency Economic Powers Act to implement the tariff.

“If the illegal migration crisis is alleviated through effective actions taken by Mexico, to be determined in our sole discretion and judgment, the Tariffs will be removed,” the White House said in a statement.

But if Trump is not satisfied, the 5% figure will increase to 10% on 1 July, to 15% on 1 August, to 20% on 1 September and to 25% on 1 October.

“Tariffs will permanently remain at the 25 percent level unless and until Mexico substantially stops the illegal inflow of aliens coming through its territory,” the statement read.

On a press call Thursday night, the White House chief of staff, Mick Mulvaney, insisted that imposing tariffs on Mexican imports would not interfere with the continuing negotiations over a North American trade deal.

“The two are absolutely not linked,” he told reporters.

Asked about the impact of the tariffs on the economy, Mulvaney said illegal immigration was “already impacting the economy negatively”.

He said the White House briefed Republican members of Congress before the plan was announced and that lawmakers were generally supportive. But Trump’s aggressive trade policies have divided Republicans and sparked fears for the US and global economy.

During a visit to Canada on Thursday, the vice-president, Mike Pence, vowed the deal would be passed this year.

“Our administration is working earnestly with leaders in the Congress of the United States to approve the USMCA this summer,” he said. Asked by reporters about the new tariff consideration, Pence said that both Mexico and Congress needed to do more and that Trump was determined to use his authority to call on them to do so.

Lauren Gambino contributed reporting



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