The much talked about trade tariffs imposed by the U.S. on Mexico, Canada and China have gone into effect today. These tariffs took effect at 12:01 a.m. on March 4, shortly before President Trump’s address to a joint session of Congress. "No room left for Mexico or for Canada, no," Trump said while speaking with reporters. "The tariffs, they're all set, they go into effect tomorrow."

On Tuesday, President Donald Trump's administration implemented a 25% tariff on most imports from Mexico and Canada, with a particular focus on Canadian energy products, which face a 10% tariff. The tariff on Chinese goods increased from 10% to 20%, building on the existing duties that have already affected hundreds of billions in Chinese imports.

In response, both China and Canada swiftly retaliated. China announced additional tariffs on key U.S. agricultural products, including chicken, pork, soybeans, and beef, with rates ranging from 10% to 15%. These retaliatory measures will take effect on March 10. Beijing also imposed export controls on about two dozen U.S. companies, a move likely to impact businesses with operations in China.

Meanwhile, Canadian Prime Minister Justin Trudeau condemned the tariffs as “unjustified” and stated that Canada would impose 25% tariffs on more than $20 billion worth of U.S. goods immediately, with another $86 billion to follow in three weeks. Trudeau also highlighted that Canada would explore non-tariff measures to respond if the U.S. did not reverse course. Ontario Premier Doug Ford escalated tensions further, suggesting he would consider cutting off the energy supply to the U.S. in retaliation.

The U.S. administration claims these tariffs are necessary to address ongoing concerns about the illegal trafficking of fentanyl into the U.S. President Trump has argued that the tariffs will push the two neighbouring countries to strengthen border controls and curb the flow of illicit drugs. Canada and Mexico had been granted temporary reprieves in February, after pledging to address drug trafficking issues, but Trump decided to move forward with the tariffs after assessing the progress made by both nations.

The tariffs’ immediate impact was felt across global markets, with U.S. stocks plunging sharply ahead of the tariff deadline. Markets across the US saw significant declines as investors feared the onset of a full-scale trade war. Markets in Asia and Europe followed suit, with Japan’s Nikkei index dropping by over 2% and Hong Kong’s Hang Seng Index falling by 1.5%.

The tariffs are expected to impact industries that rely heavily on imports, such as automotive, electronics, and agriculture. American consumers could see increased prices for items like fresh produce, cars, and electronics, with car prices rising by up to $12,000.

Additionally, steel and aluminium tariffs are scheduled to take effect on March 12, while reciprocal tariffs, which mirror the duties imposed by other countries on U.S. goods, are expected to begin on April 2.