Canada, Mexico and China all said Tuesday they will impose retaliatory tariffs on imported American goods after U.S. President Donald Trump levied new tariffs on their exports to the United States. The United States imposed new 25% tariffs Tuesday on exports from its two biggest trading partners, Mexico and Canada, and doubled an earlier 10% tariff on Chinese imports to 20%. Trump imposed the new tariffs on Mexico and Canada, its closest neighboring countries, even after they said they have curtailed illegal migration and the flow of illicit drugs into the U.S. as Trump had demanded. All three major U.S. stock indexes fell sharply after Trump’s announcement on Monday, and each dropped about 2 percentage points at the start of trading on Tuesday. Trump has said the tariffs may inflict some temporary economic pain for U.S. consumers and businesses, with higher prices on imported goods from the three countries. But in the long run, he says, it will push corporations with operations in the three countries to move manufacturing to the United States to avoid the tariffs. In all capital letters, Trump wrote on his Truth Social media platform, “If companies move to the United States, there are no tariffs!!!” Canada Canadian Prime Minister Justin Trudeau said his country would retaliate against Trump’s tariff hike and “will not let this unjustified decision go unanswered.” He said Canada would impose 25% tariffs on $107 billion worth of American goods. Trudeau said Canada has surged personnel and equipment to the border to stop the flow of fentanyl to the United States, as Trump had demanded as a possible path to averting the new tariff on Canadian imports. “Because of this work — in partnership with the United States — fentanyl seizures from Canada have dropped 97% between December 2024 and January 2025 to a near-zero low of 0.03 pounds seized by U.S. Customs and Border Protection,” Trudeau said. Trump’s decision, he said, “will disrupt an incredibly successful trading relationship,” and the tariffs will lead to Americans paying more for products such as groceries, gasoline and cars. Asked about Trump’s motivations for imposing tariffs, Trudeau said Trump “wants to see a collapse of the Canadian economy because that would make it easier to annex us.” Trump has frequently suggested adding Canada as the 51st U.S. state and mockingly called Trudeau “governor.” “The United States launched a trade war against Canada,” Trudeau said. “Canadians are reasonable. We are polite. We will not back down from a fight.” He described Trump as a “smart guy,” but said the tariffs are a “very dumb thing to do.” Trump immediately retorted that if Trudeau imposes a retaliatory tariff on U.S. imports, he would hike U.S. duties on Canadian goods by the same amount. Mexico Mexican President Claudia Sheinbaum said she would impose her own retaliatory tariffs on U.S. goods and announce which products it would target on Sunday at a public event on Mexico City’s central plaza. She assailed Trump’s tariff hike, saying, “There is no motive or reason nor justification that supports this decision that will affect our people and our nations.” After Trump promised the new duties on Mexico and Canada last month, Sheinbaum sent 10,000 troops to Mexico’s northern border with the U.S. to curb the flow of narcotics. Trump and other administration officials this week said the apprehensions of people illegally crossing the U.S.-Mexico border dropped to a record low in February. China Trump has blamed China as the main source of the deadly fentanyl opioid entering the U.S. China’s Commerce Ministry said in a statement Tuesday that it firmly opposes the U.S. tariff hike, and that China will take countermeasures to protect its interests. China also said the tariffs violate World Trade Organization rules and undermine U.S.-China economic cooperation. The Chinese finance ministry said that beginning March 10, China will impose a 15% tariff on imports of U.S. chicken, wheat, corn and cotton. A 10% tariff will apply to U.S. sorghum, soybeans, pork, beef, fruits, vegetables and dairy, the ministry said in a statement. The fallout from the tariff hikes could roil the economies of all three countries, with possibly less U.S. demand for higher-priced imported goods and higher prices for U.S. consumers and businesses for the products that actually are transported into the United States. Target, a popular U.S. retailer, said customers could see higher prices on imported goods from the three countries in the next couple of days. Mexico, Canada and China, in that order, are the three biggest national trading partners with the U.S., although collectively, the 27-nation European Union is larger than all three individually. Trump, at the first Cabinet meeting of his new presidential term last week, said he would “very soon” announce a 25% tariff on EU exports to the U.S. With Trump signaling the new tariff on goods sent to the U.S., the EU vowed to respond “firmly and immediately” to “unjustified” trade barriers and suggested it would impose its own tariffs on U.S. imports if Trump proceeds with his. Trump said reciprocal tariffs on nations that levy taxes on U.S. exports are still set to take effect on April 2. He has also hinted at putting tariffs on automobile imports, lumber, pharmaceutical products and other goods. Many economists have repeatedly warned that tariffs could lead to higher prices, boosting troublesome inflation in the U.S. Trump has acknowledged there could be short-term pain for Americans but has contended that tariffs would ultimately be beneficial to the U.S. economy, the world’s largest. Some information for this story was provided by The Associated Press, Agence France-Presse and Reuters.