The White House’s Official Tariff Announcement

On February 1, 2025, the White House released a fact sheet detailing President Donald J. Trump’s decision to impose tariffs on imports from Canada, Mexico, and China. The administration justified these tariffs under the International Emergency Economic Powers Act (IEEPA), citing an "extraordinary threat" posed by illegal migration and fentanyl trafficking as a national emergency. As a result, the U.S. announced a 25% tariff on imports from Mexico and Canada and a 10% tariff on imports from China.  

A Temporary Deal

A month ago, President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau successfully individually negotiated a temporary halt to the tariffs on Mexico and Canada. The agreement allowed a 30-day pause, during which time high-level discussions took place between the involved nations. However, the 10% tariff on Chinese imports was implemented. During this first pause the White House did not provide specific criteria or measurable benchmarks for when or how these tariffs might be removed. The U.S. government maintained its position that Mexico and Canada had a shared responsibility in alleviating what it called a migration crisis and reducing the flow of fentanyl into the United States. But analysts questioned who, exactly, would determine whether Mexico and Canada had done enough and what specific steps they were expected to take.  

Trump Announces Tariffs Would be Implemented on March 4 

On Thursday, February 27, 2025, President Trump was asked about the status of the tariffs. He confirmed that despite ongoing discussions, the 25% tariffs on Mexico and Canada, as well as an additional 10% tariff on China, would be implemented at midnight on March 4. It is important to highlight a subtle shift in Trump’s justification. During this latest announcement, the president placed greater emphasis on fentanyl trafficking as the primary reason for the tariffs. This does not mean migration is no longer a priority, but it does suggest that the U.S. may be more concerned with fentanyl flow reduction. 

The Government of Mexico's Response

On the morning of March 4, President Claudia Sheinbaum addressed the situation during her daily morning press conference. She acknowledged the newly implemented tariffs but made a deliberate choice not to immediately apply countermeasures against the U.S.. This response signals a clear strategy: Sheinbaum understands that an immediate trade war would escalate tensions exponentially, and she wants to exhaust all diplomatic avenues before taking retaliatory action. Sheinbaum also emphasized that Mexico had honored its commitments under the agreement that led to the previous 30-day pause. She announced that she would personally hold a phone call with President Trump on Thursday, March 6, to discuss the tariffs directly. She explained that while high-level officials from both countries had engaged in conversations over the past month, the official implementation of the tariffs required direct intervention between the heads of state.  

This call does not guarantee that the tariffs will be lifted, but it does create a crucial opportunity for de-escalation. If both leaders can establish tangible, measurable benchmarks, they may be able to align on a plan that ensures cooperation on migration and fentanyl reduction while avoiding further economic damage. However, Sheinbaum also made it clear that if the U.S. refuses to roll back the tariffs, she will announce Mexico’s countermeasures at a public gathering in El Zócalo on Sunday, March 9. She assured the public that Mexico has had a contingency plan prepared in advance and is ready to act if necessary. When asked about USMCA negotiations, Sheinbaum confirmed that discussions are ongoing. This signals that despite the tariffs, Mexico remains committed to maintaining a trade relationship.

Canada and China's Response

In contrast to Mexico’s measured approach, Canada and China reacted swiftly and aggressively. Canadian Prime Minister Justin Trudeau announced that Canada would impose a 25% counter-tariff on $155 billion worth of American goods. Of this, $30 billion in tariffs would take effect immediately, with the remaining $125 billion in tariffs scheduled for March 24. Meanwhile, China announced tariffs ranging from 10% to 15% on U.S. agricultural products, effective next week. These swift countermeasures signal a more confrontational approach compared to Mexico’s strategy of direct negotiation first, retaliation second.  

Analysis

This international crisis represents an unprecedented moment for North America. However, Sheinbaum’s response to this crisis has been a textbook example of strategic diplomacy. By not immediately retaliating, she is giving diplomacy a chance, understanding that an uncontrolled escalation could be detrimental to the entire region. Yet, by simultaneously making it clear that Mexico will respond if necessary, she ensures that Mexico does not appear weak.  

Her approach contrasts sharply with Canada and China, both of whom moved straight to countermeasures. While retaliatory tariffs are an understandable response to U.S. economic aggression, they also accelerate trade tensions rather than defuse them. The reality is that a full-scale trade war benefits no one. While Trump’s tariffs may be economically damaging to Mexico, Canada, and China, retaliatory tariffs will also hurt American consumers and industries.  

In the best-case scenario, Sheinbaum and Trump hold a productive conversation on Thursday, leading to a rollback of tariffs on Mexico and a new framework for cooperation on migration and fentanyl. However, if the call fails to produce a breakthrough, the situation becomes far more unpredictable. The 25% tariff on Mexican goods, combined with Mexico’s likely retaliatory tariffs, would mark a fundamental break in over two decades of steady North American economic integration.  

The coming days will shape the future of U.S.-Mexico trade relations. If Sheinbaum’s diplomatic approach succeeds, tensions could de-escalate. If not, the world may witness one of the most significant trade shifts in modern history. With Mexico’s countermeasures ready, all eyes are now on Thursday’s call between Sheinbaum and Trump. The stakes could not be higher.