Washington DCA few moments ago
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US Secretary of State Marco Rubio, President Donald Trump and Defense Minister Pete Hegseth at a cabinet meeting at the White House on 8 July. (Left to right)
US President Donald Trump has announced a 30% tariff on Mexico and European Union. He said that from August 1, tariffs will be applicable from these two countries on goods coming to America. He informed about this step on his ‘Truth Social’ platform.
Trump also threatened the two that if they retaliate, the tariff rate would be further increased.
Trump clearly wrote in the letter-
If you retaliate and increase the tariff, then I will add them to our 30% as percentage they are.
This is the same kind of letter that Trump has sent to many business partners of the world, which talks about putting heavy tariffs on foreign goods coming in America.
Negotiations were going on for 6 months on tariff
The European Union and Mexico were talking to the US for the last 6 months over the tariff. But Trump’s decision has made it clear that the deal could not be reached between him.
The European Union is the third largest economy in the world. It consists of 27 countries in Europe. The US, European Union has a trade of about $ 3.5 billion every day. At the same time, Mexico is the largest trading partner in America.
Trump said- EU business deficit too much
In a letter to the European Union president, Trump said that the tariff will be implemented from 1 August. He also made it clear that if an European company sends its products to America through another country, then they will be charged the same tariff.
Trump argued that the trade deficit between the US and the European union is very high, and this tariff of 30% is an essential step towards improving it.
He also proposed to European companies that if they start making their products in the US, they will not have to pay tariffs, and the US government will help in approving a fast and professional manner.
Trump blamed Fentenyl’s smuggling
In a letter to the President of Mexico, Trump said that the tariff is being installed due to the fennel drug spread in Mexico. He described Mexican drug cartells as the worst in the world and said that these cartoles are bringing deadly drugs like Fentaenile to the US.
Trump said Mexico has failed to stop these cartells. That is why, now the US is putting tariffs on all products coming from Mexico.
US Free Trade Agreement with Mexico
Significantly, America has a free trade agreement with Mexico. Under this, there is no tariff (duty) on any kind of import-export between the two countries. Trump performed North America Free Trade Agreement (NAFTA) with Mexico and Canada in his previous term.
America’s tariff also damaged America
According to CNN, the automobile industry has a major contribution in the economy of Mexico. About 25% of vehicles sold in the US are made in Mexico. Increasing the tariff will increase the price of these trains in the US.
The Economy Minister of Mexico said that 88% of the pick-up trucks sold in the US are made in Mexico. They are sold a lot in rural areas of America, from where Trump has got heavy votes.
If Trump puts tariffs on the goods coming from Mexico, it can increase the price of vehicles by up to 3 thousand dollars. This will not only cause damage to American companies, but will also affect the American economy.
According to experts, the decision to increase the tariff can prove to be bad for American companies. He says that this tariff can have a big impact on the profits of ‘Detroit Three Automkers’.
The Detroit Three consists of General Motors, Ford and Salentis. All three are the largest America -making companies in America. These companies make their vehicles in Mexico and sell in the US.