Trump Halts Tariff Implementation, Directs Review of Trade Policy with China, Canada, and Mexico

By Van Tam|21/01/2025 11:35

On January 20, 2025, President Donald Trump decided to delay imposing new tariffs and instead directed federal agencies to review trade policy with China, Canada, and Mexico. This move aims to address issues such as trade deficits, unfair trade practices, and currency manipulation.

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This move aims to address issues such as trade deficits, unfair trade practices, and currency manipulation

Reassessing Trade Policy

In a memorandum expected to be issued, President Trump instructed federal agencies to investigate and resolve matters related to trade deficits, unfair trade practices, and currency manipulation by nations, particularly China, Canada, and Mexico.

During his election campaign, Trump had pledged to impose steep tariffs, including 60% on Chinese goods and 25% on imports from Canada and Mexico. However, this decision reflects a more cautious approach. Instead of immediately enacting new tariffs, the president has ordered a review of China's compliance with the Phase 1 trade agreement signed in 2020 and an assessment of the United States-Mexico-Canada Agreement (USMCA), which is scheduled for review in 2026.

Reactions from Trade Partners

President Trump's decision to delay tariff implementation has been met with positive reactions from trade partners. China and Canada, two of the United States’ largest trade partners, welcomed the move. However, they also emphasized the need to continue dialogue and cooperation to address outstanding trade issues.

Nonetheless, trade experts have cautioned that imposing new tariffs could disrupt existing trade agreements and destabilize global supply chains. They underscored that a careful and dialogue-based approach would yield better outcomes for all parties involved.

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On January 20, 2025, President Donald Trump decided to delay imposing new tariffs and instead directed federal agencies to review trade policy with China, Canada, and Mexico

President Trump's decision to temporarily hold off on new tariffs and instead focus on reviewing trade policy with China, Canada, and Mexico reflects a prudent and deliberate strategy to address international trade issues. This highlights an awareness of the importance of maintaining stable trade relationships and avoiding actions that could harm the global economy. Continued dialogue and cooperation among nations will be key to resolving current trade challenges while fostering sustainable economic growth for all stakeholders.

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