US says ‘pain’ worth it as Canada, Mexico hit back

Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum have held a call to discuss strengthening ties and economic cooperation in the face of Trump’s tariff move, which has drawn global condemnation.

The Trump administration plans to impose levies of 25 percent on goods from Canada, and 10 percent on energy products from the country starting from Tuesday. Goods from Mexico will be subject to tariffs of 25 percent, while imports from China face 10 percent.

Trudeau says his country will respond with matching tariffs on up to 155bn CAD (roughly $106.5bn) in US imports. Sheinbaum has also ordered retaliatory tariffs, while China promised “countermeasures”, saying the US tariffs seriously violate World Trade Organization rules.

Trump said that the potential domestic “pain” caused by the tariffs and retaliatory measures taken against the US will “be worth the price that must be paid”, also railing against critics of his plan, on his platform Truth Social.

Mexico avoided Trump’s tariff threat

In Mexico, the official public approach to Trump’s tariff threat has been different from Canadian’s fiery response, limiting statements to saying the government is prepared for whatever is coming and it would ensure the country was respected.

Recalling how in 2019 Mexico was ultimately able to avoid Trump’s tariff threat by adding immigration control to the responsibilities of its newly formed National Guard, Mexico was hoping to dodge the tariffs again or at least find a way to get them lifted quickly.

But the accusation of criminal alliances with President Sheinbaum’s administration pushed her to punch back. She called on the US to clean up its own problems with drugs and guns and keep its nose out of Mexico.

Mexico in November warned President Trump’s tariffs would cost 400,000 US jobs.

The tariffs could trigger an economic crisis in Mexico

Gabriela Siller, director of economic analysis at the Mexican financial group Banco Base, says the tariffs could trigger an “economic crisis” in Mexico resulting in a blow for key industries, rising unemployment and price hikes.

In the short term, President Claudia Sheinbaum’s government would likely have to “apply a countercyclical fiscal policy in Mexico so there would not be a crash” and take on mounting debt, Siller said.

In the long term, the government would need to seek out new trade agreements, but over-dependence on trade ties with the US will make it hard for Mexico to quickly diversify exports, she added.

Texas governor warns Canada’s PM after comments

The governor of the southern US state of Texas has warned Canada’s Prime Minister Justin Trudeau after he addressed American citizens about US President Trump’s imposition of tariffs.

“Careful Trudeau. The Texas economy is larger than Canada’s. And we’re not afraid to use it,” Republican Governor Greg Abbott posted on X after Trudeau spoke.

Earlier, Trudeau addressed Americans directly saying the tariffs “will have real consequences for you”.

“We don’t want to be here. We didn’t ask for this. But we will not back down,” Trudeau said late Saturday. “We’re certainly not looking to escalate, but we will stand up for Canada.”

US alcohol pulled from store shelves in Ontario

Doug Ford, the premier of Ontario province, announced the removal of all US alcohol from store shelves in Canada’s most populous province.

The Liquor Control Board of Ontario (LCBO) – a government enterprise and retailer of wine, beer, and spirits – was ordered to make the move in response to US President Donald Trump’s imposition of tariffs on Canadian goods.

“Every year, LCBO sells nearly $1 billion worth of American wine, beer, spirits and seltzers. Not anymore. Starting Tuesday, we’re removing American products from LCBO shelves,” Ford said.

German leader decries President Trump’s wide-ranging tariffs

German Chancellor Olaf Scholz has warned of the effects of punitive US tariffs on world trade.

“The global exchange of goods and commodities has proven to be a great success story that has enabled prosperity for all of us,” he told journalists at a meeting with UK Prime Minister Keir Starmer at his Chequers country residence, outside London.

“That is why it is important that we do not divide the world with many customs barriers, but that we make this exchange of goods and services possible in future as well.”

US President Donald Trump has threatened the European Union with tariffs because of trade surpluses with countries such as Germany.