Trump Ignites Trade War with 30% Tariffs on EU and Mexico

 Trump Ignites Trade War with 30% Tariffs on EU and Mexico

 Trump Ignites Trade War with 30% Tariffs on EU and Mexico Starting August 

US President Donald Trump threatened on Saturday to impose 30% tariffs on imports from Mexico and the European Union starting August 1, after weeks of negotiations with his country's two major trading partners failed to produce a comprehensive trade agreement.

Trump announced the decision, which sparks the trade war, in separate letters on Truth Social to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum.

The EU and Mexico are among the United States' largest trading partners.

Trump sent similar letters to 23 other US trading partners last week, including Canada, Japan, and Brazil, setting overall tariff rates between 20% and 50%, in addition to a 50% tariff on copper. The August 1 deadline gives the countries targeted by Trump's rhetoric a window to negotiate trade agreements that could reduce the tariff rates he has threatened.

Three EU officials told Reuters on Saturday that Trump's threats represent a negotiating ploy. Trump's letter to the EU included a demand that Europe eliminate its tariffs, an unquestionable condition for any future agreement.

"The European Union will allow the United States full and open access to its market without imposing tariffs on us, in an effort to reduce our significant trade deficit," Trump wrote. Von der Leyen said that a 30% tariff would "disrupt essential transatlantic supply chains, to the detriment of businesses, consumers, and patients on both sides of the Atlantic."

She added that while EU members would continue to work toward a trade agreement, they would "take all necessary steps to protect the EU's interests, including adopting proportionate countermeasures if necessary."

Canada faces a 35% higher tariff than Mexico, and both countries attributed the decision to impose the tariffs to fentanyl flows, even though government data shows that the amount of drugs seized at the Mexican border is much higher than that at the Canadian border.

Trump said, "Mexico has helped secure the border, but what they are doing is not enough. Mexico has not yet stopped the cartels that are trying to turn all of North America into a drug trafficking arena."

Mexico sends more than 80% of its total exports to the United States, and free trade with its northern neighbor helped it overtake China to become the United States' largest trading partner in 2023.

The European Union initially hoped to conclude a comprehensive trade agreement that would eliminate tariffs on industrial goods for both sides, but months of difficult talks led the bloc to conclude that it may have to settle for an interim agreement in the hope of negotiating a better deal.

The 27-nation bloc is under conflicting pressure, with Germany urging a swift agreement to protect its industry, while other EU members, such as France, say negotiators should not agree to a unilateral agreement that yields to US conditions.

The series of tariffs imposed by Trump since his return to the White House has begun generating tens of billions of dollars in new revenue for the US government each month. Revenues exceeded $100 billion in the federal fiscal year through June, according to Treasury Department data released Friday.