The US president Donald Trump is granting a 90-day extension on the tariff agreement deadline to negotiate the agreement with Mexico. He cited the challenges of negotiating comprehensive trade agreements as the rationale for this move. Indeed, just over two weeks ago Trump threatened the EU and Mexico with tariffs up to 30% on nearly all exports to the U.S. This decision is a continuation of that recent threat.
The extension will give the Biden Administration more time to engage in negotiations over Mexico’s worker and trade practice violations. Trump suggested that the relationship between the U.S. and Mexico wasn’t so cut and dry. These complexities produce very peculiar challenges that stand apart from interactions with other countries. He stated, “The complexities of a Deal with Mexico are somewhat different than other Nations because of both the problems, and assets, of the Border.”
In the recent negotiations, Trump bagged a victory with Brussels. This deal lays in stone a 15% baseline tariff rate, effective August 1. While this agreement marks a step forward, he linked Canada’s chances of reaching a similar deal to its position on Palestine, expressing concern over Canada’s recent announcement supporting statehood for Palestine.
“Wow! Canada has just announced that it is backing statehood for Palestine,” – Donald Trump
“That will make it very hard for us to make a Trade Deal with them. Oh’ Canada!!!” – Donald Trump
That’s in addition to the punitive 35% tariff that Trump has already slapped on Canada. He is threatening Brazil with a mind-boggling 50% tariff if it doesn’t cease what he terms a “witch-hunt” toward its former leader, Jair Bolsonaro. Finally, he trumpeted the impending completion of a trade deal with Australia.
Trump’s general approach to international trade has resulted in punitive tariffs on just about every country that hasn’t signed a free trade agreement with the U.S. This list includes guilty nations such as developing countries like Lesotho, Bangladesh and Nepal. Perhaps most newsworthy, he has imposed similar tariffs on rich countries, like Canada and Taiwan.
In his speech, Trump specifically cited Mexico’s agreement to end dozens of non-tariff trade barriers. He said, “We have agreed to extend, for a 90 Day period, the exact same Deal as we had for the last short period of time, namely, that Mexico will continue to pay a 25% Fentanyl Tariff, 25% Tariff on Cars, and 50% Tariff on Steel, Aluminum, and Copper.”
On top of this, Trump suggested that US-China trade negotiations were going a lot better than everyone thinks. In related news, Treasury Secretary Scott Bessent announced that a currency deal with China is “close.” There’s another important deadline Trump needs to muscle U.S.-China trade talks before—this one, on August 12. An extension has been always agreed upon in principle but still awaits formal approval from the White House.
Negotiations are currently underway on several fronts. So, the key question is how these tariffs and any future agreements will serve U.S. interests while shaping international relations that promote reciprocity and accountability. What’s happening is a reminder of the fraught and complex interconnectedness of global trade in our growingly connected world.