Trump sets March 4 tariffs on Mexico, Canada, adds 10% for China

U.S. President Donald Trump on Thursday said his proposed 25 percent tariffs on Mexican and Canadian goods will take effect on Tuesday, along with an extra 10 percent duty on Chinese imports because deadly drugs are still pouring into the U.S. from those countries.

The fresh China tariffs, in addition to the 10 percent tariff levied on February 4, coincide with the start of China’s annual parliamentary meetings on Wednesday, a setpiece political event where Beijing is expected to unveil its main economic priorities for 2025.

The announcement also leaves Beijing less than a week to publish countermeasures, as the Trump administration shows signs of a hardening stance towards its strategic rival despite backing down on the threat of 60 percent tariffs when Trump took office.

Trump told reporters in the Oval Office he decided to add the extra tariffs on China and stick to the Tuesday deadline for Canada and Mexico given what his administration sees as insufficient progress on curbing fentanyl flows into the country.

“There are ongoing discussions with the Chinese, Mexico and Canada,” a White House official told Reuters. “We’ve gotten a good handle on the migration issue, but there are still concerns on the other issue of fentanyl deaths.”

Mexico on Thursday extradited nearly 30 convicts to the U.S. including drug lord Rafael Caro Quintero, who was convicted in 1985 of murdering a U.S. Drug Enforcement Administration agent.

According to the Centers for Disease Control, 72,776 people died from synthetic opioids in 2023 in the U.S., chiefly from fentanyl.

Customs and Border Patrol agents seized 991 pounds of fentanyl at the southwest border in January 2025, down 50.5 percent from a year earlier, but still enough to kill many millions of Americans, the White House official said.

Tariff tactics

Trump’s decision to ratchet up tariffs on Chinese goods mirrors his moves to escalate tariffs during his first-term trade wars with Beijing until serious trade negotiations took place between the world’s two largest economies.

With trade talks not materializing yet, there are signs Trump is preparing for a wider economic decoupling from China, dashing hopes that a deal might be reached in the near-term.

The White House last Friday released an America First investment memorandum which squarely placed China in a list of “foreign adversaries” and accused Beijing of seeking to exploit investments in U.S. firms to steal cutting-edge technology and fund its military development.

“PRC-affiliated investors are targeting the crown jewels of United States technology, food supplies, farmland, minerals, natural resources, ports, and shipping terminals,” the document said, using an acronym for the People’s Republic of China.

Washington will also review the variable interest entity (VIE) structure allowing hundreds of Chinese firms to be listed in the U.S., potentially forcing them to delist if this loophole is found to be detrimental to U.S. investors or enable fraud.

This would wipe about $848 billion from U.S. securities markets, according to 2024 figures from the U.S.-China Economic and Security Review Commission.

Earlier this month, Trump nominated China hawk Landon Heid for a key post at the Commerce Department overseeing the design of AI chip export controls targeting China and other countries.

The State Department’s China page was also updated this month to include tougher language on China’s “restrictive” investment climate, unfair trade practices and tech competition.

The Chinese embassy had no immediate comment. China on Friday said it had cracked 38,000 drug-related criminal cases, seized 28.1 tons of drugs and captured seven drug fugitives in the past year, without specifying if any of those figures were related to the U.S. or fentanyl.

Thus far, Chinese President Xi Jinping has not engaged in negotiations over fentanyl, instead applying limited 10 percent retaliatory duties on U.S. energy and farm equipment.

But Beijing could push back harder as Trump’s new tariffs reach 20 percent on U.S. imports from China, on top of existing duties of up to 25 percent imposed during Trump’s first term. U.S. imports from China totaled $439 billion last year, according to U.S. Census Bureau data.

Piling on more tariffs could pose risks to both the Chinese and U.S. economies. China has been struggling with a property crisis and weak domestic demand, while U.S. inflation remains sticky and interest rates are elevated.

China, in a letter to U.S. Trade Representative Jamieson Greer, called for equal dialogue and consultation.

During a news conference on Thursday, Trump downplayed the potential inflationary impact of tariffs for Americans, arguing that his first-term tariffs on China raised hundreds of billions of dollars without negatively affecting the U.S. economy.

“I find that it’s not about inflation. It’s about fairness. And the inflation for us has not existed, and I don’t think it’s going to exist,” he said.

Tariff, border talks

Canadian and Mexican officials were due to meet with Trump administration counterparts in Washington on Thursday and Friday to try to forestall the tariffs, which could deal a serious blow to a highly integrated North American economy.

Mexican Economy Minister Marcelo Ebrard will meet with Greer on Thursday and Commerce Secretary Howard Lutnick on Friday.

Ebrard’s deputy, Vidal Llerenas, on Thursday said Mexico could adopt other trade measures beyond the recent tariffs it imposed on certain imports to reduce cheap shipments from China.

In Canada, Public Safety Minister David McGuinty said on Thursday that the progress Canada has made on tightening security along the border with the United States and combating drug smuggling should satisfy the Trump administration.

Reporting by Doina Chiacu, Jeff Mason, Andrea Shalal and David Lawder; additional reporting by David Lawder in Washington, Disha Mishra in Bengaluru, David Ljunggren in Ottawa, and Laurie Chen in Beijing; Writing by David Lawder and Joseph Ax; Editing by Chizu Nomiyama, Alistair Bell, Deepa Babington, Daniel Wallis and Lincoln Feast