Trump backs down on import tariffs, easing trade war fears

KATHMANDU: U.S. President Donald Trump has decided to postpone the proposed tariff hike on imports from Canada and Mexico by one month. The move has sparked fresh discussions in the global trade sector.

Initially, the Trump administration had announced tariff increases on select goods from Canada and Mexico.

However, following strong reactions and an economic impact assessment, the White House decided to temporarily hold off on implementing the new tariffs.

Along with this announcement, President Trump signed a new agreement aimed at facilitating smoother trade flows between the three North American nations.

The latest decision signals instability in trade relations between the U.S., Canada, and Mexico.

In just two days, the U.S. has made contrasting decisions regarding its key trade partners, raising concerns in financial markets. Analysts warn that such policy fluctuations create uncertainty for investors.

On Thursday, the U.S. stock market reacted negatively, with major industrial indices showing a decline.

Experts attribute the market downturn to fears of a potential trade war, which has left investors wary.

This economic uncertainty likely prompted President Trump to reconsider and delay the tariff hike.

Mexican President Claudia Sheinbaum welcomed the U.S. administration’s decision, expressing optimism that U.S.-Mexico trade ties would strengthen further.

Similarly, Canada’s trade minister announced that Ottawa would also suspend its planned retaliatory tariffs on American goods.

Canadian Prime Minister Justin Trudeau addressed the trade dispute, warning that a trade war between the two nations would hurt both economies.

He emphasized the need for diplomatic dialogue to resolve differences.

While the temporary halt on import tariffs offers some relief, trade partners remain cautious. U.S. policymakers are now exploring new strategies for a long-term trade agreement with Canada and Mexico.

Economists caution that continued instability in North American trade could have ripple effects on the global economy.

Although the recent decision has momentarily eased tensions, the future of trade relations remains uncertain.