Trump announces new tariff ultimatums for Mexico and the EU

President Donald Trump has announced his new tariff ultimatums: 30% for Mexico and the European Union.

Trump made the announcement in two letters, notifying key trading partners of the new rates. The tariffs will take effect on August 1, unless the parties can agree on better terms.

Previously, the EU had hoped to reach a preliminary agreement with the United States to prevent the introduction of tariffs.

“If you are willing to open your previously closed trade market to the United States and remove your tariff, non-tariff, political and trade barriers, we may consider adjusting this letter,” Trump wrote.

As for the EU, Trump initially announced a 20% tariff before reducing it to 10% as part of a 90-day negotiation pause. But he then threatened a 50% rate, prompting further negotiations.

Earlier this week, the EU said the bloc was moving closer to a framework deal with the US after talks between European Commission President Ursula von der Leyen and Trump.

The tariffs would apply broadly, though separately from the president’s sectoral tariffs on goods such as cars and steel. If implemented, they could put the EU at a competitive disadvantage to US exports to neighbouring Britain, which left the bloc in 2020 and was the first country to strike a major trade deal with Trump.

In a letter to Mexican President Claudia Sheinbaum, Trump said the country was “helping him secure the border” but added that it was not enough. Trump added that the US would consider adjusting the tariffs if Mexico stopped the flow of fentanyl by “challenging the drug cartels.”

The letter did not say whether the US would maintain an exemption for goods traded under the USMCA trade agreement that were exempt from the current 25% rate. The administration had previously said it would maintain an exemption for Canada.

Other countries Trump could target include Japan, South Korea, South Africa, Indonesia, Thailand and Cambodia, as well as Algeria, Libya, Iraq and Sri Lanka.

Tags: EU, USA, duties, Mexico