Tariff Wars: Trump Announces Sweeping but Temporary Exemptions for Canada, Mexico

New Delhi: US President Donald Trump has now announced tariff exemptions for Canadian and Mexican goods under the US-Mexico-Canada Agreement (USMCA).

This comes after he said a day ago that he would temporarily exempt cars from 25% import taxes.

Canada and Mexico are two of the US's biggest trade partners.

In response, Canada has said that it would also pause the second round of retaliatory tariffs on US products. Canada has already announced tariffs on Canadian $ 30 billion worth of US goods.

BBC has reported on the fact that a call between Canadian prime minister Justin Trudeau and Trump veered into uncharted territory with the US president using "profane language more than once" during a heated exchange.

Trudeau told reporters that a trade war between the two allies was likely. Other leaders in Canada also said that the latest pause was unlikely to cause longterm relief.

Mexico, which had said it would announce its own reciprocal tariff list on March 9, has thanked Trump.

The USMCA was signed during Trump's first term in 2018 after he had expressed dissatisfaction with the pre-existing North American Free Trade Agreement.

Trump's financial manoeuvres and concerns over a trade war have have sent global stock markets tumbling.

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