PALM BEACH, United States: President Donald Trump announced broad tariffs Saturday on major US trading partners Canada, Mexico and China, claiming a “major threat” from illegal immigration and drugs — a move that sparked promises of retaliation. Canadian and Mexican exports to the United States will face a 25 percent tariff starting Tuesday, although energy resources from Canada will have a lower 10 percent levy. Goods from China, which already face various rates of duties, will see an additional 10 percent tariff.

Trump’s orders also suspended exemptions allowing low-value imports from the three countries to enter the US duty-free. The announcement threatens upheaval across supply chains, from energy to automobiles to food. Trump invoked the International Emergency Economic Powers Act in imposing the tariffs, with the White House saying “the extraordinary threat posed by illegal aliens and drugs, including deadly fentanyl, constitutes a national emergency.”

The aim is to hold all three countries “accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country,” the White House added.

Trump’s new tariffs will probably not have a major impact on China’s economy but may herald the opening salvo of another bruising trade war with Beijing, analysts said Sunday. However, his action against Beijing was “not a big shock to China’s economy”, according to Zhiwei Zhang, president of Pinpoint Asset Management. Given Beijing had already factored in higher tariffs this year, the move was “unlikely to change the market expectation on China’s macro outlook”, Zhang said.

“I don’t think China needs to take action, such as exchange rate depreciation, to offset (the impact),” he added. According to Bloomberg Economics, the 10 percent levy could knock out 40 percent of Beijing’s goods exports to the US, affecting 0.9 percent of Chinese GDP. That is a small fraction of China’s vast economy, but it would put extra pressure on policymakers already grappling with slowing growth, a property sector crisis, and sluggish domestic consumption.

Experts said Trump’s focus seemed to be on trade relationships with Canada and Mexico more than China. Under the new rules, Canadian and Mexican exports to the US will face 25 percent tariffs, with a partial exemption for Canadian energy resources.

But with targeted countries already vowing retaliation and Trump promising more duties in future, the move was “just the first strike in what could become a very destructive global trade war”, said Paul Ashworth, chief North America economist at Capital Economics.

China’s commerce ministry said in a statement it would take “corresponding countermeasures” and file a claim against Washington at the World Trade Organization. Mexican President Claudia Sheinbaum announced that her country would impose retaliatory tariffs. Sheinbaum said she had told her economy minister “to implement Plan B that we have been working on, which includes tariff and non-tariff measures in defense of Mexico’s interests.”

Canadian Prime Minister Justin Trudeau — who spoke with Sheinbaum — separately said his country would hit back with 25 percent levies of its own on select American goods worth Can$155 billion (US$106.6 billion), with a first round on Tuesday followed by a second one in three weeks.

“We’re certainly not looking to escalate. But we will stand up for Canada, for Canadians, for Canadian jobs,” he said, as he warned of a fracture in longstanding Canada-US ties. British Columbia Premier David Eby announced that his province would specifically retaliate against “red” US states led by members of Trump’s Republican Party. On Sunday, the finance minister of Japan — a major US trade partner — said they were “deeply concerned about how these tariffs could affect the world’s economy.”

Trump has repeatedly expressed his approval of tariffs as a policy measure, and has signaled that Saturday’s action could be the first volley in further trade conflicts to come. This week, he also pledged to impose future duties on the European Union. He has also promised tariffs on semiconductors, steel, aluminum, oil and gas. “Tariffs are a powerful, proven source of leverage for protecting the national interest,” the White House said.

“The tariff action announced today makes clear that our friends, neighbors and Free Trade Agreement partners are in the line of fire,” said Wendy Cutler, vice president at the Asia Society Policy Institute and a former US trade negotiator. “The move today is an opening salvo on the tariff front,” she told AFP. Economic integration between the United States, Mexico and Canada — who share a trade pact — means stiff tariffs will have “a strong and immediate impact” in all three countries, she said. Imposing sweeping tariffs on the three biggest US trading partners in goods carries risks for Trump, who won November’s election partly due to public dissatisfaction over the economy. — AFP