"The Immediate Threat is Averted, but..." Despite Tariff Deferral for Canada and Mexico, 'Threats Remain'

Until Trump's Victory Declaration

Can't Relax Despite Tariff Deferral for Canada and Mexico

25% Tariff Scheduled for the 4th Deferred for a Month

Canada and Mexico Promise to Strengthen Crackdown on Illegal Immigration and Drugs

If They Fall Short of Trump's Standards, Tariff Threats May Reemerge

The tariffs that U.S. President Donald Trump pushed for Canada and Mexico have been deferred for a month, but analysis suggests it's too early to relax. Given President Trump's negotiation style, if he doesn't secure concessions from Canada and Mexico that allow him to declare a clear victory within this deferral period, he could bring out the tariff card at any time.

On the morning of the 3rd (local time), President Trump introduced on his Truth Social account that he had spoken with Mexican President Claudia Sheinbaum, announcing that Mexico had agreed to immediately send 10,000 troops to the Mexico-U.S. border. Consequently, he announced a one-month deferral of the 25% comprehensive tariff that was to be imposed on Mexico from the 4th.

On the same day, President Trump also announced his conversation with Canadian Prime Minister Justin Trudeau, stating that the tariffs on Canada would also be deferred for a month. Canada has also decided to invest $1.3 billion in strengthening the U.S.-Canada border and deploy 10,000 personnel. They have appointed a 'czar' to handle the fentanyl issue and decided to designate drug cartels as terrorist organizations.

As a result, it is evaluated that the primary goal of President Trump's tariff imposition is ultimately to resolve issues of illegal immigration and drugs rather than fiscal deficits or job issues. If Mexico or Canada shows a willingness to resolve illegal immigration and drug issues, the tariffs could be withdrawn at any time, or their scale and scope could be reduced.

Public concern over inflation due to tariffs is also analyzed as another reason for this deferral decision. Major media outlets, including the Wall Street Journal, NBC, and Bloomberg, are pouring out articles expressing concern that tariffs could reignite inflation, which has barely calmed down in the U.S. A significant portion of agricultural products like avocados and cherry tomatoes in the U.S. are imported from Mexico. Additionally, imposing tariffs on oil imported from Canada could raise prices by at least 10 cents per gallon.

However, if a satisfactory compromise for President Trump does not emerge within the one-month deferral period, the tariff war could worsen again. President Trump has conducted political and diplomatic transactions in a sequence of threatening the other party and thereby gaining a negotiating advantage. The ultimate purpose of this process is to declare victory, but if such results do not emerge, it is evaluated that he is ready to reverse negotiations at any time.

In fact, last week, when Colombia refused to allow a U.S. military plane carrying illegal immigrants to land, President Trump immediately imposed tariffs. Colombia agreed to all of President Trump's demands within nine hours of his sanction announcement. President Trump also withdrew the tariffs immediately after reaching an agreement with Colombia.

New York = Correspondent Park Shin-young nyusos@hankyung.com