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Mexico’s president details call with Trump that paused tariffs

Mexico’s president details call with Trump that paused tariffs
By Lyndal Rowlands, Umut Uras, Maziar Motamedi, Alma Milisic, Virginia Pietromarchi and Usaid Siddiqui
Published On 3 Feb 2025

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4 Feb 2025 - 19:30
 (19:30 GMT)

Trump-Xi call won’t happen today: Report

US President Donald Trump and Chinese leader Xi Jinping will not speak on Tuesday, a US official has told The Wall Street Journal.

The report contradicts what Trump’s trade adviser Peter Navarro said earlier in the day. It comes as Beijing has announced retaliatory tariffs on select American imports and an antitrust investigation into Google, just minutes after a sweeping levy on Chinese products imposed by Trump took effect.

3 Feb 2025 - 23:59
 (23:59 GMT)

Thank you for joining us

Read here for more on Mexico and the US announcing a monthlong pause to sweeping US tariffs.

Here is an analysis to watch on EU leaders discussing the threat of the economic measures from US President Donald Trump.

To know more about how stock markets in Hong Kong, Japan and South Korea reacted to the tariffs on Canada, China and Mexico, read here.

3 Feb 2025 - 23:55
 (23:55 GMT)

Here’s what happened today

We will be closing this live page soon. Here is a recap of today’s main events:

  • US President Donald Trump announced a pause in imposing steep tariffs on Mexico and Canada, which were set to come into effect on Tuesday, for 30 days.
  • Both Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum said they agreed to bolster border enforcement efforts in response to Trump’s demand to crack down on immigration and drug smuggling.
  • Trudeau said Canada would deploy new technology and 10,000 police along its border with the US to stop the flow of fentanyl.
  • Mexico’s Sheinbaum said her country agreed to reinforce its northern border with 10,000 National Guard members to fight drug trafficking.
  • Trump warned he might increase tariffs on China beyond the 10 percent he already announced and he would discuss the matter with President Xi Jinping in the next day or so.
3 Feb 2025 - 23:45
 (23:45 GMT)

Trump threat to seize Greenland needs ‘robust response’: Denmark

Denmark’s prime minister has insisted that Greenland isn’t for sale and called for a robust response from the EU should Trump press ahead with his threat to take control of the island.

“I will never support the idea of fighting allies. But of course, if the US puts tough terms on Europe, we need a collective and robust response,” Mette Frederiksen told reporters.

Last month, Trump left open the possibility that the US military might be used to secure Greenland as well as the Panama Canal. “We need Greenland for national security purposes,” Trump said.

Frederiksen said she had “great support” from her EU partners on the fact “that everybody has to respect the sovereignty of all national states in the world, and that Greenland is today a part of the Kingdom of Denmark. It’s part of our territory and it’s not for sale.”

3 Feb 2025 - 23:30
 (23:30 GMT)
Explainer

What does the US import from Canada?

The US trade balance for goods and services with Canada amounted to a deficit of -$41bn. But if energy is excluded, the US ran an overall surplus of +$63bn with Canada.

Below are the top five US imports from Canada:

  • Mineral fuels and related minerals – $133.7bn
  • Non-machinery and transport manufactured goods – $104.9bn
  • Machinery and transport equipment – $104.6bn
  • Food and beverages – $37.6bn
  • Crude materials – $19.6bn
3 Feb 2025 - 23:23
 (23:23 GMT)

Union denounces ‘trade regime that devastated the American and global working class’

The United Autoworkers union has called Trump’s tariffs “a good first step to undoing decades of anti-worker trade policy” but added that it doesn’t endorse “using factory workers as pawns in a fight over immigration or drug policy”.

The UAW said in a statement that since returning to the White House two weeks ago, Trump has pursued an “anti-worker policy at home” by not honouring labour agreements and “gutting the National Labor Relations Board”.

The union says the White House must supplement its moves on tariffs by pushing for talks to renegotiate the United States-Mexico-Canada Agreement, and “a full review of the corporate trade regime that has devastated the American and global working class”.

The announced tariffs on Canada and Mexico would disrupt the US automobile industry as well since car companies have supply chains that extend across all three nations.

3 Feb 2025 - 23:15
 (23:15 GMT)

EU will respond if unfairly targeted by US: EC chief

The European Union wants a constructive dialogue with the United States but is ready to respond firmly if it is “unfairly” targeted by the Trump administration, European Commission President Ursula von der Leyen says.

“We discussed our transatlantic partnership. This remains our most consequential relationship. We discussed ways to strengthen a very pragmatic cooperation with the United States,” she said during a news conference.

“There are clearly new challenges and new uncertainties and when targeted unfairly or arbitrarily, the European Union will respond firmly.”

European Commission President Ursula von der Leyen [File: Yves Herman/Reuters]
3 Feb 2025 - 23:08
 (23:08 GMT)

Poland’s PM rails against ‘totally unnecessary and stupid tariff war’

After three years spent trying to deter Russia from destroying Ukraine, European Union leaders grappled with possible responses to a major ally who appears determined to start a trade war or perhaps even seize part of their territory.

Polish Prime Minister Donald Tusk said it would “be a cruel paradox, if during the time of this direct Russian threat and Chinese expansion”, the EU and the United States might end up in a “conflict among allies”.

Since taking office in the White House last month, Trump has threatened to impose tariffs on EU imports and refused to rule out the use of military force to take control of Greenland, an autonomous territory of NATO ally Denmark.

Trump’s threats amount to “a serious test” of European unity, and “in a very strange context, because it’s the first time where we have such a problem among allies”, said Tusk.

“We have to do everything to avoid this totally unnecessary and stupid tariff war or trade war.”

Poland’s Prime Minister Donald Tusk [File: Ebrahim Noroozi/AP]
3 Feb 2025 - 23:00
 (23:00 GMT)

US Secretary of State Rubio notifies Congress of USAID review

US Secretary of State Marco Rubio has notified the US Congress that a review of USAID’s foreign assistance activities is under way “with an eye” towards the agency’s potential reorganisation.

According to the US secretary of state, USAID “has long strayed from its original mission of responsibly advancing American interests abroad, and it is now abundantly clear that significant portions of USAID funding are not aligned with the core national interests of the United States”.

Earlier, Trump appointed Rubio as the embattled agency’s acting administrator.

3 Feb 2025 - 22:52
 (22:52 GMT)

WATCH: Trump tariffs top agenda at EU meeting

European Union leaders gathered amid the threat of tariffs from US President Donald Trump on imports, stating that if Trump goes ahead with the threat, Europe will respond.

Al Jazeera’s Hashem Ahelbarra explains.

3 Feb 2025 - 22:45
 (22:45 GMT)

German Chancellor Scholz says EU can protect its own interests

Europe is strong enough to pursue its own interests in trade talks with the US, German Chancellor Olaf Scholz said after a meeting with fellow EU leaders.

“The European Union is strong. We have every opportunity to make sure we can look after our own interests,” Scholz said. “And that is also a message to the United States, which at the same time is connected to us through an outstretched hand.”

Scholz also praised Mexican President Claudia Sheinbaum for winning breathing room from US President Donald Trump’s threatened tariffs for 30 days.

“The Mexican president is a smart politician,” he said. “She played it cool.”

German Chancellor Olaf Scholz [File: Markus Schreiber/AP]
3 Feb 2025 - 22:30
 (22:30 GMT)

US stocks join global selloff on Trump tariffs

Wall Street stocks dropped, joining overseas markets in retreating after Trump’s announcement of tariffs on Canada, Mexico and China.

Trump on Monday said tariffs on Mexico and Canada were paused for a month. Nevertheless, all three major US indices still ended the day lower, with the Dow Jones Industrial Average falling by 0.3 percent to 44,421.91.

The broad-based S&P 500 fell by 0.8 percent to 5,994.57, while the tech-rich Nasdaq Composite Index shed 1.2 percent, to 19,391.96.

3 Feb 2025 - 22:15
 (22:15 GMT)
Analysis

‘Direct attack’: Close Canada-US relationship now badly damaged

Daniel Beland, a political science professor at McGill University in Montreal, says Trump’s actions and pronouncements towards Canada are “unprecedented and highly damaging for the relationship”.

“He is eroding Canadians’ trust towards the US in ways that will make it hard to repair the relationship,” said Beland.

Many Canadians feel betrayed by Trump’s threats and attitude, especially because the two countries have long enjoyed strong economic, cultural and geographic ties.

“It’s certainly one of the worst moments in Canada-US relations since the creation of Canada in 1867,” Beland said.

“His talk about making Canada the 51st state is a direct attack against the country’s sovereignty. Even if we exclude that threat, he shows no respect for Canada’s sovereignty and institutions.”

3 Feb 2025 - 22:05
 (22:05 GMT)
Developing

Trump confirms tariffs on Canada suspended for 30 days

US tariffs will be paused for a 30-day period to see whether a final economic deal with Canada can be structured, US President Trump confirmed.

Trump said he was “very pleased” after several phone calls with Canadian Prime Minister Justin Trudeau led to the last-minute reprieve.

Canada on Saturday said it would impose 25 percent tariffs on $106.5bn of US goods with the initial tariffs to kick in on Tuesday.

That threat was in response to Trump’s announcement of 25 percent tariffs on all goods from Canada, also effective Tuesday.

3 Feb 2025 - 21:55
 (21:55 GMT)

How much could Trump’s trade war cost Canada?

Prominent economists spoke to Canada’s largest online news site, The Toronto Star, on the impact of Trump imposing 25 percent tariffs on most imports from Canada. Here’s what they said:

  • Pedro Antunes, chief economist at the Conference Board of Canada, said the move would cost “hundreds of thousands of jobs”, especially in the automotive industry.
  • Jim Stanford, chief economist at the Centre for Future Work, noted that even if the tariffs will be temporary, the uncertainty has already caused long-term damage. “We’ve never had a trade shock outside of wartime like this since the Great Depression. So we are in uncharted territory.”
  • Douglas Porter, chief economist at the Bank of Montreal, said a “modest recession” was a real possibility should the economic measures last a year.
  • Royal Bank of Canada economists Frances Donald and Nathan Janzen said tariffs could push up Canadian unemployment rates by 2-3 percentage points.
3 Feb 2025 - 21:44
 (21:44 GMT)
Houthi

Canada PM Trudeau: Trump tariffs paused for 30 days

Canada’s Prime Minister Trudeau says Trump’s tariffs will be postponed by at least 30 days after he promised more cooperation on border security.

“I just had a good call with President Trump,” Trudeau said on X, adding that Canada would deploy nearly 10,000 front-line police officers to help secure the border, list drug cartels as terrorists, appoint a “Fentanyl Czar”, and crack down on money laundering.

3 Feb 2025 - 21:42
 (21:42 GMT)

‘Trump may well be looking for a way out of this’

By Alan Fisher

Reporting from Washington, DC

Donald Trump says the trade deficit with Canada is somewhere in the region of $200bn. But it’s actually only about $65bn, so he’s inflated that number.

The Canadians have said they’ll respond and they’re doing it in a savvy way by targeting largely Republican states, putting a squeeze on economies in those areas, believing if there’s enough pressure, they might turn to Trump to say, “Hey, you need to do something about this”.

So you can see why President Trump may well be looking for a way out of this because there’s going to be huge economic pressure on the US.

And Canada would like to get a way out as well because it could tip its economy into recession if it goes on for any length of time.

3 Feb 2025 - 21:38
 (21:38 GMT)

Trump’s tariff threat sends crypto prices falling

Cryptocurrency prices took a hit from the prospect of a trade war between the US and its major trading partners with some well-known digital assets seeing values fall by more than 10 percent.

Bitcoin fell below $100,000 after US President Trump announced plans on Saturday to start putting large tariffs on goods from Canada, Mexico and China.

The world’s most popular cryptocurrency fell to about $92,000 on Sunday night before rebounding to about $99,000 by Monday morning after Trump announced a pause on the tariffs on Mexican goods.

3 Feb 2025 - 21:30
 (21:30 GMT)
Analysis

US tariffs could still hurt manufacturing even if paused

Economists warn that even if tariffs are delayed, the hanging threat would still be a constraint for manufacturing through a strong dollar that makes US-made goods uncompetitive on the global market.

“Tariffs represent a negative supply shock, which hurts production and raises prices, a much smaller scale of what we experienced in the pandemic,” said Kathy Bostjancic, chief economist at the insurer Nationwide.

“Another round of tariffs from the US would amplify the deleterious impact on inflation and GDP growth.”

3 Feb 2025 - 21:15
 (21:15 GMT)
Explainer

What are retaliatory tariffs?

A retaliatory tariff is a duty or tax that a country slaps on imports from another nation in response to tariffs imposed by the first. It is a way for countries to hit back against trade practices they view as damaging to their economies.

Following US President Donald Trump’s announcement of steep tariffs on Canada, Prime Minister Justin Trudeau said he would put matching 25 percent tariffs on up to $106bn of US imports.

During Trump’s first term, China imposed tariffs of up to 25 percent on more than 120 US products – including pork, fruits, nuts and wine – in retaliation for Trump‘s decision to raise duties on Chinese imports.

China said the decision, which affects about $3bn worth of imports from the US, is aimed at safeguarding its interests and balancing losses caused by tariffs imposed by Trump.