Before taking office in January next year, Donald Trump has threatened to impose heavy tariffs on Canada, Mexico and China in a social media post that has angered all three countries.
According to a Reuters survey, the new US government could impose tariffs of up to 40% on imports from China next year. Although China has decided to provide its companies with huge funds to deal with Trump’s tariff war, Canada and Mexico, whose economies are not in good shape, will face significant difficulties.
Trump has announced on social media that he will impose a 25% tariff on all imports from Mexico and Canada. In addition, Chinese goods will face an additional 10% tariff unless Beijing takes concrete steps to stop the smuggling of the synthetic opioid fentanyl into the US.
Donald Trump will avoid imposing tariffs on 60% of Chinese goods, according to a Reuters poll. Trump, who took office in January, pledged to impose steep tariffs on Chinese imports as part of a package of ‘America First’ trade measures during his election campaign, which has angered Beijing and raised growth risks for China. The tariff rates are much higher than the 7.5%-25% imposed on China during Trump’s first term, while the economy is also in a much weaker position due to a prolonged asset downturn, credit risk and weak domestic demand.
A Reuters poll from November 13-20 found that Chinese expect Trump to impose tariffs early next year, with an average estimate of 38%.
The new US tariffs could shave about 0.5%-1.0 percentage points off China’s 2025 economic growth. However, most economists polled by Reuters maintained their median growth forecasts for this year and 2025 at 4.8% and 4.5%, respectively, roughly in line with forecasts made before the US election. China’s growth is expected to slow further to 4.2% in 2026.
According to the Economist Intelligence Unit (EIU), the US’s three largest trading partners, Mexico, China and Canada, are the most vulnerable to Trump’s proposed policies. The Economist Intelligence Unit has ranked India eighth on its list of countries that could face trade challenges during a Trump presidency.
