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    Ontario leader threatens to halt energy exports to US if Trump imposes tariffs

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    The leader of Canada’s largest province says he’s prepared to halt energy exports to the United States, warning that other premiers “need to be ready to fight” as threats escalate ahead of possible American tariffs.The Ontario premier, Doug Ford, says he’s weighing options to fight back against a 25% levy on all Canadian goods that the US president-elect Donald Trump has pledged to implement when he assumes office.Following a meeting with the nation’s premiers and the prime minister, Justin Trudeau, Ford said other leaders were also drawing up lists of exports that could be halted.“But we will go to the full extent, depending how far this goes, we will go to the extent of cutting off their energy, going down to Michigan, going down to New York state and over to Wisconsin,” said Ford. “I don’t want this to happen, but my number one job is to protect Ontario, Ontarians and Canadians as a whole.”Canada’s most populous province is also among the most vulnerable to American tariffs because roughly 85% of its exports – including billions in automotive parts – are sent to a handful of US states. As a result, Ford has emerged as the Canadian politician most vocal about the devastating effects the tariffs would have on hundreds of billions of shared trade.“We need to be ready. We need to be ready to fight,” said Ford. “This fight is coming 100% on January 20 or January 21.”Ford’s threat aims to highlight both the integrated nature of North American economies and also to put pressure on state governors. But is unclear how much Ford could follow through on his pledge to cut electricity exports, given that premiers do not make international energy policy.Canada supplies roughly 60% of all American oil imports and even more of its electricity imports. In 2022, Canada’s revenue from electricity exports to the United States hit a record high of C$5.8bn. Quebec is the largest exporter, with Ontario following second at 13.9m megawatt-hours of power sent south.“We will use every tool in our tool box to fight back,” said Ford. “We can’t sit back and roll over. We just won’t as a country. And isn’t this a shame, our closest friends and allies.”Trump threatened last month to apply the devastating levies of 25% on all goods and services from both Mexico and Canada, vowing to keep them in place until “such time as drugs, in particular fentanyl, and all illegal aliens stop this invasion of our country!”Last week, Trump seemed to take joy in the panicked response from Canadian officials, calling Trudeau Canada’s “governor” of a potential “51st” state. More

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      If Trump’s tariffs start a trade war, it would be an economic disaster | Mark Weisbrot

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      “To me, the most beautiful word in the dictionary is tariff, and it’s my favorite word,” said Donald Trump last month. Pundits, politicians and financial markets are trying to figure out why, since he announced a week ago that he would impose tariffs on the United States’s three biggest trading partners: 25% for Mexico and Canada, and 10% for China.One theory is that tariffs can be a beautiful distraction. Trump, more than any previous US president, has fed on distractions for years, both to campaign and to govern. He can move seamlessly from one distraction to the next, like a magician preparing for the opportune moment to pull a coin from where it appears to have been hidden behind your ear.Although he still has seven weeks before he takes office, he could use a distraction that can start sooner. He has run into problems with cabinet and other appointments that require Senate confirmation. Of course he could easily find people who would do his bidding and be acceptable to a Senate with a Republican majority. But that would defeat the main purpose of nominating people who seem indefensible: to force Republican senators to display the abject subservience that Trump needs to be public, in order to ensure his unwavering dominance within his party.This is no small part of his governing strategy; it involves a big takeaway from the failures of his first term, from his point of view. The lesson is: loyalty to Trump first. Violators will be banished. And with small margins in the Senate and the House, things could begin to unravel if this core imperative goes unenforced.But the days before Trump actually takes office could also be the best time for him to use the threat of tariffs to begin bullying foreign governments for things that might benefit his allies, donors or himself. Other governments besides the three that he named are trying to figure out what they can offer Trump to avoid the economic disruption of tariffs. Christine Lagarde, the head of the European Central Bank, who does not see Trump as a friend, has urged the EU to negotiate with him, rather than adopt a retaliatory, eg tariff, response.Trump’s two offered pretexts for the tariff threat – migration and drugs, in this case fentanyl – are not credible. About 18% of the undocumented people encountered by border patrol over the past year have been from Venezuela and Cuba, two countries that have been devastated economically by sanctions imposed by the US government. If reducing immigration were really Trump’s concern, he would not have deployed sanctions that have driven millions of people from their homes to the US border; and he could end these sanctions in January by himself.Broad economic sanctions are a form of economic violence which targets civilians in order to achieve political ends, including regime change. US congressman Jim McGovern, a Massachusetts Democrat, made this clear in a letter that he wrote to Joe Biden asking for the sanctions on Venezuela to be dropped. The Trump sanctions in Venezuela in 2017 killed tens of thousands of civilians during the first year, and many more in the years that followed, including under Biden.As for fentanyl, about 75,000 people died from overdoses of this drug in 2023. But it’s difficult to see how Trump’s tariffs could help solve this problem. It’s a glaring example of how more than four decades of a failed “war on drugs”, based on criminalization of use and supply-side intervention, have made things worse. In this case the drug war has led to an innovation – fentanyl – that is vastly more powerful than heroin, much cheaper to produce, more addictive and easier to transport, distribute and produce.There is general agreement in the economic research on the effects of Trump’s trade and tariff wars in his first term as president, in which he placed tariffs on about $380bn of US imports. The overall impact on living standards for US workers and most Americans is found to be negative, with the cost of the tariffs being absorbed by US consumers. Employment overall did not increase, and may have fallen due to the negative impact of retaliatory tariffs.The economic research looking at the expected impacts of tariffs that Trump has talked about going forward also finds the impact on the US economy to be negative. And there is potential for much more damage if other countries respond with more retaliatory tariffs than they did in 2018-2020.Meanwhile, the productivity of Trump’s tariff offensive in generating distractions remains high. On Sunday he took a shot at the so-called Brics countries – Brazil, Russia, India, China and other economic powers: “We require a commitment from these countries,” Trump wrote on Truth Social, “that they will neither create a new Brics currency nor back any other currency to replace the mighty US dollar or they will face 100% tariffs and should expect to say goodbye to selling into the wonderful US economy.”None of these things will happen while Trump is in office. Nor will threats like this deter the majority of the world, when it is ready, from replacing a system of global governance that is overwhelmingly run by one country with help from the richest people in other rich countries. Our current system is one in which the “exorbitant privilege” that the dollar-based financial system bestows upon the US government gives the president the power to destroy whole economies with the stroke of a pen.But this is a longer story; for Trump it’s just another threat and another distraction in the post-truth world that he, as much as anyone, helped create. But he will need more than distractions to take this country further down the road toward de-democratization, which is what brought to him and his party the power that they now have.

      Mark Weisbrot is co-director of the Center for Economic and Policy Research. He is the author of Failed: What the “Experts” Got Wrong About the Global Economy More

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      Trudeau meets rivals as he seeks united front in face of Trump tariff threat

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      Canada’s federal government has redoubled its efforts to ward off potentially disastrous tariffs from its closest ally, but provincial leaders have hinted at divergent strategies in response to the protectionist threat from president-elect Donald Trump.Canada’s prime minister, Justin Trudeau, convened a rare, in-person meeting with his political rivals on Tuesday to brief them on a surprise meeting with Trump at his Florida resort over the weekend.The gathering in Ottawa was attended by Trudeau’s one-time ally Jagmeet Singh of the New Democratic party and Pierre Poilievre, the Conservative leader and Trudeau antagonist vying to become prime minister in the coming months.Last week, Trump threatened in a social media post to apply devastating levies of 25% on all goods and services from both Mexico and Canada, vowing to keep them in place until “such time as drugs, in particular fentanyl, and all illegal aliens stop this invasion of our country!”Most of Canada’s provinces share a land border with the United States and roughly 75% of the country’s exports are bound for American markets.That figure varies wildly when it comes to provincial economies. The Atlantic provinces send as little as 20% down to their southern counterparts. Alberta, on the other hand, sends nearly 90% of its exports to the US, the vast majority of which are oil.If Ontario were a country, it would be the US’s third-largest trading partner.The province’s premier, Doug Ford, has appealed to a shared history with his American neighbours – and nearly C$500bn of annual trade – in a 60-second ad which will run in the US market including on Fox News and during National Football League games with millions of viewers.Ford also repeated warnings that the measure would rebound on US consumers, telling local media: “1,000% it’s gonna hurt the US. Nine thousand Americans wake up every single morning to build products and parts for Ontario, and customers in Ontario … My message to [Trump] is: Why? Why attack your closest friend, your closest ally?”As much as 85% of Ontario’s exports are sent south, with the vast majority related to the automotive industry.But in British Columbia, where less of its economy is tied to the US, the premier, David Eby, has pledged to search out other export markets.Roughly half of the province’s exports, including softwood lumber and metallurgical coal, from BC is bound to the US, according to provincial trade figures.“We’re going to continue to do our work to expand those trading opportunities,” Eby told reporters, a nod to the growing lure of overseas markets for a province on the Pacific Ocean.Given Trump’s previous follow-through on tariff threats, his latest warning prompted a scramble in Ottawa, with Trudeau securing a meeting with Trump at Mar-a-Lago, becoming the first G7 leader to meet the president-elect since the US election.The meeting, attended by key advisers from both camps, was described as a “very productive meeting” by Trump. Trudeau, who flew to Florida with the aim of dissuading the president from imposing tariffs, described the meeting as “excellent conversation” – but left without any assurances.Without that promise, experts say Canada will need a unified voice to lobby elected officials in the US.“Coordinating Canadian leaders to conduct extensive outreach in the US – which worked well during Trump’s first term – will be harder this time, because an election is looming in Canada, because Trudeau is behind in the polls,” said Roland Paris, a former foreign policy adviser to Trudeau and director of the University of Ottawa’s Graduate School of Public and International Affairs.“Discord at home makes this advocacy campaign tougher, but that’s the situation that we face now. It’s a different moment in the political life cycle of this government.Poilievre has spent the last week suggesting the prime minister was caught off-guard by Trump’s win in November, despite assurances from federal officials that contingency plans for a Trump or Kamala Harris win were in place.The Conservative leader also criticized Trudeau’s emergency meeting with provincial premiers last week. “Justin Trudeau’s plan to save the economy? A Zoom call!” he posted on social media.Paris cautioned too much against playing domestic politics with a sensitive trade relationship.“Party leader leaders in Canada are going to have to be careful, because if they’re perceived to be working against the national interest in pursuit of their partisan objectives, then that could blow up in their faces too.” More

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      Trump maintains hard line on Canada after meeting with Trudeau

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      Donald Trump said he had a “productive” meeting with Justin Trudeau after the Canadian prime minister paid a surprise trip to his Mar-a-Lago estate amid fears about Trump’s promised tariffs.Trudeau became the first G7 leader to meet with Trump before his second term amid widespread fears in Canada and many other parts of the world that Trump’s trade policy will cause widespread economic chaos.But Trump also seemed to double down on the threat, which he has frequently linked to trying to encourage other countries to combat drug smuggling into the US.“I just had a very productive meeting with Prime Minister Justin Trudeau of Canada, where we discussed many important topics that will require both Countries to work together to address, like the Fentanyl and Drug Crisis that has decimated so many lives as a result of Illegal Immigration, Fair Trade Deals that do not jeopardize American Workers, and the massive Trade Deficit the US has with Canada,” Trump said in a statement posted to Truth Social, his social media platform.Trudeau and a handful of top advisers flew to Florida amid expectations that Trump will impose a 25% surcharge on Canadian products that could have a devastating impact on Canadian energy, auto and manufacturing exports.The meeting over dinner between Trudeau and Trump, their wives, US cabinet nominees and Canadian officials, lasted over three hours and was described by a senior Canadian official to the Toronto Star as a positive, wide-ranging discussion.Trump added: “I made it very clear that the United States will no longer sit idly by as our Citizens become victims to the scourge of this Drug Epidemic, caused mainly by the Drug Cartels, and Fentanyl pouring in from China. Too much death and hardship! Prime Minister Trudeau has made a commitment to work with us to end this terrible devastation of U.S. Families.”Leaving a Florida hotel in West Palm Beach on Saturday, Trudeau said: “It was an excellent conversation.”The face-to-face meeting came at Trudeau’s suggestion, according to the Canadian official, and had not been disclosed to the Ottawa press corps, which only found out about Trudeau’s trip when flight-tracking software detected the prime minister’s plane was in the air.The two leaders discussed trade; border security; fentanyl; defense matters, including Nato; and Ukraine, along with China, energy issues and pipelines, including those that feed Canadian oil and gas into the US.Over a dinner that reportedly included a dish called “Mary Trump’s Meat Loaf”, the pair also discussed next year’s G7 meeting, which Trudeau will host in Kananaskis, Alberta – seven years after Trump abruptly left the 2018 G7 at Charlevoix, Quebec, amid a US-Canadian dispute over American steel and aluminum tariffs.The Pennsylvania senator-elect Dave McCormick posted a photo to the social media platform X late Friday showing Trudeau sitting beside Trump. Others in the picture included Howard Lutnick, Trump’s nominee for commerce secretary; Governor Doug Burgum of North Dakota, the pick for interior secretary; and the US representative Mike Waltz of Florida, the pick for national security adviser.Canadian officials included the public safety minister, Dominic LeBlanc, responsible for border security, and Trudeau’s chief of staff, Katie Telford. Canada’s ambassador to Washington, Kirsten Hillman, and Trudeau’s deputy chief of staff, Brian Clow, were also at the dinner.LeBlanc said Canada was prepared to beef up border security, with more money for technology, drones and more Mounties and border guards on the 49th parallel.Earlier on Friday, Trudeau told reporters that he looked forward to having “lots of great conversations” with Trump and that the two would “work together to meet some of the concerns and respond to some of the issues”.Trudeau also said that it was “important to understand is that Donald Trump, when he makes statements like that, he plans on carrying them out. There’s no question about it.“Our responsibility is to point out that in this way, he would actually not just be harming Canadians, who work so well with the United States, he would actually be raising prices for American citizens as well, and hurting American industry and businesses.”skip past newsletter promotionafter newsletter promotionBut some observers were less than impressed.“The symbolism of Trudeau going down to Palm Beach on bended knee to say ‘Please don’t’ is very, very powerful,” Fen Hampson, professor of international affairs at Carleton University in Ottawa, told Bloomberg.“The stakes are enormously high and Trudeau has to deliver on this,” Hampson said. “Otherwise, it’s going to be seen by Canadians as a failed mission, because we all know why he’s going down there and it’s not to baste the turkey for Trump.”The scramble to diffuse Trump’s tariff threats has also pre-occupied the Mexican president, Claudia Sheinbaum, in recent days.On Thursday, Sheinbaum said she had had a “very kind” phone conversation with Trump in which they discussed immigration and fentanyl. She said the conversation meant there “will not be a potential tariff war” between the US and Mexico.But the two leaders differed on Trump’s claim in a post on Truth Social that Sheinbaum had “agreed to stop Migration through Mexico, and into the United States, effectively closing our Southern Border”.The Mexican president later said she had not. “Each person has their own way of communicating, but I can assure you, I guarantee you, that we never – additionally, we would be incapable of doing so – proposed that we would close the border in the north [of Mexico], or in the south of the United States. It has never been our idea and, of course, we are not in agreement with that.”Sheinbaum said the pair had not discussed tariffs but their conversation reassured her that no tit-for-tat tariff battle would be necessary.Trump also expanded on his economic message on tariffs to other global leaders on Saturday, threatening Brics countries – an acronym that includes Brazil, Russia, India, China and South Africa – with 100% tariffs if they acted on discussions to drop the dollar as their reserve currency.“The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER,” Trump wrote on Truth Social.Trump said the US would require “a commitment” from Brics nations – a geopolitical alliance that now also includes Iran, Egypt, Ethiopia and the United Arab Emirates – “that they will neither create a new BRICS Currency, nor back any other Currency to replace the mighty U.S. Dollar or, they will face 100% Tariffs”. More

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      ‘He loves to divide and conquer’: Canada and Mexico brace for second Trump term

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      Stone-faced as he stared into a gaggle of cameras on Tuesday, the leader of Canada’s largest province laid bare how it feels to be America’s northern neighbour and closest ally this week.“It’s like a family member stabbing you right in the heart,” said Ontario’s premier, Doug Ford. A day before, president-elect Donald Trump had pledged hefty tariffs on Mexico and Canada, the US’s two largest trading partners. “It’s the biggest threat we’ve ever seen … It’s unfortunate. It’s very, very hurtful.”For both Mexico and Canada, whose economic successes are enmeshed in their multibillion-dollar trade relationships with the United States, the forecasted chaos and disruption of a second Trump term has arrived. And the first salvo from Trump has already forced leaders from Mexico and Canada to revisit their relationship with the US – and with each other.Both have maxims to describe living in the shadow of the world’s largest economic and military superpower, which sees nearly $2tn worth of goods and services pass through its two land borders.“Living next to you is in some ways like sleeping with an elephant,” the late prime minister Pierre Trudeau told then US president Richard Nixon. “No matter how friendly and even-tempered is the beast, if I can call it that, one is affected by every twitch and grunt.”For Mexicans, it is the words of the 19th-century dictator Porfirio Díaz: “Poor Mexico: so far from God, so close to the United States.”The vagaries of the relationship were tested again this week when Trump threatened in a social media post to apply devastating levies of 25% on all goods and services from both countries, and to keep them in place until “such time as drugs, in particular fentanyl, and all illegal aliens stop this invasion of our country!”Although in 2018 the US, Canada and Mexico renegotiated the Nafta trade pact that Trump had long blamed for gutting US manufacturing, the three countries still have deeply intertwined supply chains – especially an automotive industry that spans the continent – making a levy of that magnitude potentially devastating to all.In Canada, Trump’s demands have left the government scrambling to make sense of the threat – and how seriously to take it.“‘Good-faith negotiator’ is not usually a descriptor of Donald Trump. He loves to disrupt it. He loves to divide and conquer,” said Colin Robertson, a former senior Canadian diplomat who has had numerous postings in the US. “Trump is determined to truly make his mark. Last time he was disorganized. This time, he’s certainly started off demonstrating a high degree of organization.”Even before Trump’s announcement, the Canadian prime minister, Justin Trudeau, and a handful of provincial premiers had mused openly about cutting Mexico out of future trade talks, instead pivoting towards a Canada-US trade pact – a move that Mexico’s lead negotiator called a “betrayal”.On Wednesday, Trudeau held an emergency meeting with all 10 premiers to push a “Team Canada” approach to the confrontation, pledging hours later to invest more in border security – a nod to Trump’s criticism of Canada’s patrolling of its border.A challenge for Canada is a need to approach Trump with skepticism, but also to take the threats seriously, says Robertson, adding that Canada’s trade relationship with the US is immensely lopsided. “The reality is, we need them. They’re big, we’re small.”Still, Trump’s demands “are perverse, but unfortunately predictable”, says Roland Paris, director of the Graduate School of Public and International Affairs at the University of Ottawa and former foreign affairs adviser to Trudeau.He notes that only a sliver of the fentanyl entering the US comes from Canada, a figure so small the US Drug Enforcement Administration (DEA) does not even mention Canada in a report from 2020. As for migrants entering the US, Canada’s federal minister says yearly interceptions are similar to a “significant weekend” at the Mexico border.“This is [Trump’s] modus operandi,” said Paris. “He’s not wasting any time throwing America’s principal trading partners off balance, before he even enters office.”Ottawa’s efforts to smooth things over with Trump are also hampered by domestic politics. Trudeau remains immensely unpopular in polls, and the rival Conservatives have cast the prime minister as weak and ill-equipped to both preserve what Nixon called Canada’s “special relationship” with the US and to face off against a mercurial president.Paris imagines the prime minister’s cabinet, especially veterans of bruising negotiations with Trump during his first term, as “determined” to manage relations with a country that for decades has remained a staunch ally. He says years of close work has produced a significant overlap in policy goals for the two nations, including skepticism of China and a need to secure critical mineral and energy supply chains.skip past newsletter promotionafter newsletter promotion“Canada is going to need resolve, patience and the most far-reaching advocacy campaign this country has ever conducted in the United States,” he said. “But everybody knows that Trump is so unpredictable that there’s no saying what he might do this time.”For Mexico, which has long borne the brunt of Trump’s ire, Monday’s tariff threat comes amid already tense relations, including a reform to elect almost all judges by popular vote that has drawn sharp criticism from the US. At the same time, the arrest in July of two top Sinaloa cartel bosses in Texas, a move that surprised Mexican officials, has triggered a bloody gang war that the Mexican president, Claudia Sheinbaum, blames on the US.On Wednesday, Sheinbaum spoke with Trump, a conversation which the US president-elect characterised as “wonderful” after he claimed the Mexican president pledged to “stop Migration through Mexico, and into the United States, effectively closing our Southern Border”. Sheinbaum later gently clarified that she wouldn’t close the border, but that the call was “very kind” and had convinced her that no tariffs would happen.Martha Bárcena, a former Mexican ambassador to the US, said Trump’s tariff suggestion has kicked off “panic” in the Mexican community living in the US. “How can you hit your partners in a free trade agreement with tariffs 25% higher than what you put on the rest of the world? It’s crazy,” she said.“What was his ceiling is now his floor,” she said of his previous negotiating position on trade. “The lesson? Never yield to a bully.”Alejandro Celorio Alcántara, a Mexican diplomat who oversaw migration when Trump first came to power, says the bombast of the next US president can be easier to work with than more traditional allies.“The Biden administration is a little more diplomatic, but this can actually make the discussion more complicated, because you don’t know what the terms of negotiation are,” he said. “Maybe it’s just my style of negotiation. It’s simpler when it’s more open. They put the cards on the table: ‘This is what we want.’ Then you can respond.”Both Mexico and Canada have scores of diplomats already experienced with Trump, but both sides also expressed concern that many of the key figures in Trump’s first term, who acted as a “check” on the president’s whim-based policy decisions, will be absent from the second administration, replaced by loyalists and idealogues who will do whatever he says.Still, for Mexican officials, there is a glimmer of hope that those in positions of power are more reasonable when they’re not in the media spotlight. Alcántara noted that “border czar” Tom Homan, who recently pledged to carry out a “mass deportation’, is known for his controversial positions, “but if you take the facts to him and explain them, he understands. He has a certain discourse in the media that’s very aggressive, but when you sit down together, you can talk.”For Mexico and Canada, a recognition that their fates remain tied to the US has forced them to redouble their efforts, not to reconsider their relationship.“In the end, we need to bet on a strong North America,” said Alcántara. It’s simple: make North America great again. As a region, not just the United States.” More

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      Mexican president claims ‘no potential tariff war’ with US after call with Trump

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      Claudia Sheinbaum has said her “very kind” phone conversation with Donald Trump, in which they discussed immigration and fentanyl, means “there will not be a potential tariff war” between the US and Mexico.The president of Mexico spoke to reporters on Thursday following Trump’s threat earlier in the week to apply a 25% tariff against Mexico and Canada, and an additional 10% tariff against China, when he takes office in January if the countries did not stop all illegal immigration and fentanyl smuggling into the US.Trump, in a post on Truth Social on Wednesday, claimed that during the phone call with Sheinbaum she had “agreed to stop Migration through Mexico, and into the United States, effectively closing our Southern Border”.During her Thursday address Sheinbaum clarified she did not agree to shut down the border.“Each person has their own way of communicating,” Sheinbaum said. “But I can assure you, I guarantee you, that we never – additionally, we would be incapable of doing so – proposed that we would close the border in the north [of Mexico], or in the south of the United States. It has never been our idea and, of course, we are not in agreement with that.”She added that the two did not discuss tariffs, but that the conversation with Trump had reassured her that no tit-for-tat tariff battle would be needed in future.On Monday this week, Trump threatened to impose a 25% percent tariff on Mexico until drugs, including fentanyl, and undocumented immigrants “stop this Invasion of our Country”. He declared that Mexico and Canada should use their power to address drug trafficking and migration and, until they do, “it is time for them to pay a very big price!”The following day, Sheinbaum suggested Mexico could retaliate with tariffs of its own.On Wednesday, however, the conversation between Sheinbaum and Trump was “very kind”, the Mexican president said. She said she told Trump of the various migration initiatives her government has undertaken, including providing resources and support to central American countries and to migrants arriving in Mexico. Potential immigrants “will not reach the northern border, because Mexico has a strategy”, Sheinbaum said.Trump “recognized this effort” by the Mexican government, Sheinbaum added.She also said Trump expressed interest in the government-driven programs to address fentanyl addiction and overdoses in Mexico. And she raised the problem of American-made weapons entering Mexico from the US to be used by drug cartels.Sheinbaum further added that she encouraged Trump to stop the blockades against Cuba and Venezuela, since “people suffer and it leads to the phenomenon of migration”.Asked by a reporter from Rolling Stone magazine that quoted anonymous Trump-aligned sources discussing a “soft invasion” of Mexico by deploying the US military inside the country against drug trafficking groups, Sheinbaum dismissed the idea, calling it “entirely a movie”.“What I base myself on is the conversation – the two conversations – that I had with President Trump, and then, at the moment, the communication we will have with his work team and when he takes office,” Sheinbaum said. “We will always defend our sovereignty. Mexico is a free, independent, sovereign country – and that is above everything else.” More

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      Trump and Mexican president offer differing accounts of migration talks amid tariff threats

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      US president-elect Donald Trump declared a win on stopping illegal immigration through Mexico on Wednesday after talking with Mexican president Claudia Sheinbaum. But Sheinbaum suggested Mexico was already doing its part and would not close its borders.The two spoke just days after Trump threatened to impose sweeping new tariffs on Canada and Mexico as part of his effort to crack down on illegal immigration and drugs.Trump said Sheinbaum “agreed to stop migration through Mexico.” Sheinbaum indicated separately on social media that she told Trump that Mexico is already “taking care of” migrant caravans, calling it an “excellent conversation.”“We reiterate that Mexico’s position is not to close borders but to build bridges between governments and between peoples,” Sheinbaum added.While the state of the proposed tariffs remained unclear, Trump said in a post on his Truth Social account that this was “effectively closing our southern border.” He called it a “very productive conversation.”The exchange between the two leaders appeared to confirm for Trump the value of threatening to disrupt trade with import taxes. His initial social media post moved financial markets and gave him a response he was quick to describe as a win. Even if the proposed tariffs fail to materialise, Trump can tell supporters that the mere possibility of them is an effective policy tool and continue to rely on tariff threats.Sheinbaum wrote on social media that the leaders “discussed Mexico’s strategy on migration issues, and I told him the caravans are not reaching the northern [US] border, because Mexico is taking care of them.”“We also talked about reinforcing cooperation on security issues, within the framework of our sovereignty, and the campaign we are carrying out to prevent fentanyl consumption,” she said.Illegal migration across the Mexico border is down in part because the Biden administration secured some stepped-up cooperation from Mexico – the sort Trump seems to be celebrating.Arrivals at the US-Mexico border have dropped 40% from an all-time high in December. US officials mostly credit Mexican vigilance around rail yards and highway checkpoints.Driven by mounting pressure from the US to block migrants going north, in the past few years Mexican authorities have turned to rounding them up across the country and sending them to southern Mexico, in a strategy seen by experts as an attempt to wear migrants out until they give up.Neither side clarified the status of the tariffs. But their implementation could fuel higher prices and slow economic growth, potentially blowing up the trade agreement among the US, Canada and Mexico that was finalized in 2020 during Trump’s previous time in the White House.Trump on Monday said he would impose a 25% tax on all products entering the country from Canada and Mexico as one of his first executive orders upon taking office on 20 January. He also proposed an additional 10% tariff on China tied to its exporting of materials used in the production of fentanyl.In announcing his plans, he railed against the flow of fentanyl and migrants crossing into the US illegally, even though southern border apprehensions have been hovering near four-year lows.On Wednesday, Trump also posted that he plans a large scale ad campaign to explain “how bad fentanyl is for people to use,” predicting it would educate people on “how really bad the horror of this drug is.”The dangerously powerful opioid was developed to treat intense pain from ailments like cancer but has increasingly been mixed with other drugs in the illicit drug supply.Through September, the United States has imported $378.9bn in goods from Mexico, $322.2bn from China and $309.3bn from Canada. More

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      Canada leaders agree to unite against Trump tariff threat amid reports of retaliatory measures

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      Canada’s federal government and the premiers of the 10 provinces have agreed to work together against a threat by US president-elect Donald Trump to impose sweeping tariffs on Canadian imports, with one official saying the country was already examining possible retaliatory measures.“We agreed that we need to be smart, strong and united in meeting this challenge,” deputy prime minister Chrystia Freeland told reporters on Wednesday after a virtual meeting with the premiers called by the prime minister, Justin Trudeau.Trump has threatened to impose tariffs on products from Canada and Mexico if the countries do not stop what he called the flow of drugs and migrants across southern and northern borders. He said he would impose a 25% tax on all products entering the US from Canada and Mexico as one of his first executive orders.Canada is already examining possible retaliatory tariffs on certain items from the United States should president-elect Donald Trump follow through on his threat, the Associated Press reported, citing a senior official.Mexican President Claudia Sheinbaum said on Wednesday that her administration is already working up a list of possible retaliatory tariffs “if the situation comes to that”.The Canadian official said Canada was preparing for every eventuality and has started thinking about what items to target with tariffs in retaliation. The official stressed no decision has been made and spoke on condition of anonymity as they were not authorised to speak publicly.The pledge to impose tariffs on Canada would drive up fuel prices for Americans as it would upend decades-old oil trade from its top crude supplier, analysts said on Wednesday, with Canadian oil imports not exempt under a free-trade deal from the levies.Even as surging oil output to record highs has made the US the world’s largest producer in recent years, more than a fifth of the oil processed by US refiners is imported from Canada.In the landlocked US midwest, where refineries process 70% of Canadian crude imports, consumers could see pump prices jump by 30 cents per gallon or more, or about 10%, based on current prices, GasBuddy analyst Patrick De Haan said.Cheaper gasoline was among Trump’s priorities during his re-election campaign as he sought to connect with consumers frustrated by sky-high fuel prices in the aftermath of the coronavirus pandemic, Russia’s invasion of Ukraine, the war in Gaza and other supply disruptions.When Trump imposed higher tariffs during his first term in office, other countries responded with retaliatory tariffs of their own. Canada, for instance, announced billions of new duties in 2018 against the US in a tit-for-tat response to new taxes on Canadian steel and aluminium.Many of the US products were chosen for their political rather than economic impact. For example, Canada imports $3m worth of yoghurt from the US annually and most comes from one plant in Wisconsin, home state of then-House speaker Paul Ryan. That product was hit with a 10% duty.Another product on the list was whiskey, which comes from Tennessee and Kentucky, the latter of which is the home state of then-Republican Senate leader Mitch McConnell.Trump made the tariff threats on Monday while railing against illegal migrants, even though the numbers at Canadian border pale in comparison with the southern border. The US Border Patrol made 56,530 arrests at the Mexican border in the month of October – and 23,721 arrests at the Canadian one between October 2023 and September 2024.Canadian officials say lumping Canada in with Mexico is unfair but say they are happy to work with the Trump administration to lower the numbers arriving from Canada. The Canadians are also worried about an influx north if Trump follows through with his plan for mass deportations.Trump also railed about fentanyl from Mexico and Canada, even though seizures from the Canadian border pale in comparison to the Mexican border. US customs agents seized 43lb (19.5kg) of fentanyl at the Canadian border last fiscal year, compared with 21,100lb (9,570kg) at the Mexican border.Canadian officials argue their country is not the problem and that tariffs will have severe implications for both countries.Canada is the top export destination for 36 US states. Nearly $3.6bn (US$2.7bn) worth of goods and services cross the border each day. About 60% of US crude oil imports are from Canada, and 85% of US electricity imports are from Canada. Canada is also the largest foreign supplier of steel, aluminium and uranium to the US and has 34 critical minerals and metals that the Pentagon is eager for and investing in for national security.“Canada is essential to the United States’ domestic energy supply,” Freeland said.America’s top oil trade groups, the American Fuel and Petrochemical Manufacturers group and the American Petroleum Institute, said imposing the tariffs would be a mistake – exposing a rare moment of discord between the industry and Trump.“Across-the-board trade policies that could inflate the cost of imports, reduce accessible supplies of oil feedstocks and products, or provoke retaliatory tariffs have potential to impact consumers and undercut our advantage as the world’s leading maker of liquid fuels,” AFPM said on Tuesday.With Associated Press and Reuters More

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      Mexico president vows to retaliate with own tariffs against Trump’s tax threat

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      Mexico’s president, Claudia Sheinbaum, has rebuked Donald Trump’s threat to impose steep tariffs on Mexico, arguing the plan would do nothing to halt the flow of migrants or drugs bound for the US border, and vowing that Mexico would hit back with tariffs of its own.“One tariff would be followed by another in response, and so on until we put at risk common businesses,” Sheinbaum said, warning that tariffs would cause inflation and job losses in both countries. “What sense is there?”Sheinbaum’s comments came after Trump said on Monday that, as one of his first actions as president, he would impose a 25% tax on all imports from Mexico and Canada in an effort to stop the flow of migrants and narcotics into the United States.“This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!” Trump wrote on his Truth Social page.It is unclear if the president-elect’s proposal would even be legal or possible, given that the three countries share a free trade agreement known as the USMCA that was negotiated during his previous term in the White House.But as analysts pointed out, Trump has never been one to abide by the rules.“Did we really think that Trump was going to become more institutional or more formal?” said Valeria Moy, a Mexican economist and director general of IMCO, a public policy analysis firm. “The Trump that the United States and the world will have, at least in the signs he’s given, is a Trump that will be more dictatorial, tougher, more emboldened.”Even if they are legally questionable, the tariffs could provide Trump with a quick win upon taking office in January, said Viri Ríos, a Mexican public policy expert.“I don’t rule out that he would implement them temporarily to give a result to his electoral base, which would be happy to see that Donald Trump is being consistent with his campaign promises,” she said. “But from that to this being a long term strategy, it seems to me that it would not be good for the United States itself.”Mexico is the United States’s top trade partner as of September, representing 15.8% of total trade. According to Ríos, a 25% tariff on Mexican goods would cost the US economy $125bn over 10 years, while costing its GDP between 0.5 and 0.74%.With such steep tariffs, US companies importing Mexican goods would undoubtedly have to raise their prices.“The main victim will be the American consumer, because at the end of the day, tariffs are more or less reflected in prices,” said Moy.That could end up costing Trump politically, given the role consumer prices played in his election win.“One of the main reasons why Trump’s campaign was successful, was that people felt that inflation had increased during Biden’s last term,” said Ríos. “So I think he’s playing with fire.”Analysts also questioned whether Trump’s plan would even have its desired impact, given that the flow of drugs to the US is driven by American demand, not by the flow of goods.“It’s a bit like scapegoating,” said Ríos. “The key to this problem isn’t in Mexico, it’s in the United States.”Ultimately, analysts viewed Trump’s proposal as a threat to force Mexico on to the negotiating table and implement policies on migration and security that could have some meaningful impact on the flow of drugs and migrants to the United States.“We’ve already seen this [from Trump] – first you threaten, then you negotiate,” said Moy. “He’s using it as a threat to sit down and negotiate and say ‘Ok, you, president of Mexico … What are you going to do to contain the flow of migrants and what are you going to do in terms of security? What are you going to do to prevent fentanyl from passing from Mexico to the United States? And if you don’t do it, I’ll put tariffs on you.’” More