Transcript of Trade war looms as Donald Trump announces huge tariffs on Canada, China, Mexico | BBC News

There are growing fears of a major global trade war tonight after President Trump announced sweeping tariffs on imports from Canada, Mexico, and China starting tomorrow. And he added that very substantial tariffs would follow for the European Union. Goods exported from Canada and Mexico to the US will be hit with a 25% tariff, products from China with 10%. Canada's Prime Minister, Justin Trudeau, said his country would face difficult times as a result felt, but promised a forceful retaliation. From Washington, here's our North America editor, Sarah Smith.

He had promised to introduce tough tariffs on day one. President Trump's obviously a couple of weeks late, but clearly excited about one of his favorite policy tools.

I always say, Tariffs is the most beautiful word to me in the dictionary, because Tariffs are going to make us rich as hell. It's going to bring our country's business is The back that left us.

President Trump wants both Mexico and Canada to do more to stop migrants crossing their borders and into America, and to stem the flow of illegal drugs, including fentanyl that's flooding into the US.

The President will be implementing tomorrow a 25% tariff on Mexico, 25% tariffs on Canada, and a 10% tariff on China for the illegal fentanyl that they have sourced and allowed to distribute into our country.

Hundreds Millions of billions of dollars worth of imports are trucked from Mexico and Canada into America and the other way around. They are each other's biggest trading partners by far. For instance, 90% of the avocados sold in America come from Mexico. Charging a 25% tax on each fruit that crosses the border will hurt Mexican exporters, but it also risks increasing prices for American consumers. Canada's biggest export to America is oil. Even 10% import tariffs risk raising costs for Americans. And of course, Canada will also feel the pain if America buys less of their oil. The Prime Minister says he's ready to respond.

If the President does choose to implement any tariffs against Canada, we're ready with a response. A purposeful, forceful but reasonable immediate response.

10% terrorist will be charged on all the electronic and other goods that are shipped to America from China. Donald Trump says he wants China to stop fentanyl being exported to America But of course, it doesn't hurt to also punish one of your biggest global competitors. Donald Trump firmly believes he is the world's best negotiator and appears confident that punishing terrorists will force other nations to do what he wants. But if that doesn't happen quickly, he is risking a trade war that could result in American voters paying the price.

Let's talk to Sarah in Washington tonight. The President has only really been talking about in the last few minutes, Sarah. Tell us more.

Yeah, he was in the oval office signing the executive order that will bring in these tariffs on Canada, Mexico, and China. And he was asked if he had any plans to put tariffs on goods coming in from the EU. And he said, Absolutely. He thinks the EU treats American products very unfairly, he said. And he referenced them VAT, value-added tax being levied at 20%, which he seems to think is akin to some trade tariff that he wants to counter. So he didn't say when and he didn't say what level of tariffs, but he did say he wants to do it. Have a listen to this.

And we have a tremendous deficit with the European Union, so we'll be doing something very substantial with the European Union. We're going to bring the level up to where it should be.

Now, the level of terrorist he's talking about, 25% against Mexico and Canada, 10% on China. These are huge. This is not the normal level at which countries tend to operate when they're doing these trade negotiations. Of course, it's It's actually about Donald Trump trying to enforce an entirely different policy on the border with these countries asking for their cooperation. So this is something pretty new, and it could be risky. He said, whilst he was in the oval office there, that there is a chance that the costs will be passed on to consumers. He knows that if anything he did was to increase prices in America, put inflation up, that would be very, very dangerous for his popularity. So I wonder if he's trying to make a case that this will be done very quickly. If he gets what he wants from Canada, Mexico, and China, then these tariffs won't have to be in place for very long, and he won't risk putting the costs up for American consumers.

Sarah, thank you. Sarah Smith. Well, many Chinese businesses were certain that tariffs like this were on their way and have been taking pre-emptive action. As Laura Bicker reports, many have moved their production lines offshore to places, including Cambodia.

This all-American cowboy boot, once crafted to conquer the Wild West, has been made here in China for decades. But production has slowed as orders dwindle. Us buyers don't want to risk more of Donald Trump's tariffs on Chinese-made goods.

Mr..

Peng says a A number of different skills are needed to make each shoe. That's why he doesn't want to move the workshop out of China.

In the end, it is the workers at the bottom who suffer. With higher tariffs, we have higher costs. With higher costs, we have fewer orders. The worker's income will decrease. These are the victims at the center of Mr..

Trump's Trade War, a skilled workforce that no other job.

Other Chinese companies, however, are on the move.

Parts of Cambodia have given itself to Beijing. Half the country's investment now flows from China. These clothes are heading to US firms like Walmart and Costco. The factory and its workers are in Cambodia, but most of the materials still come from China. Wang Zhaodong shows off his newly-built factory in Phnom Penh as he gets ready for larger orders.

Factories along the whole supply chain are relocating. As a result, lots of Chinese companies are investing in Cambodia and Southeast Asia.

This factory is hiring hundreds more workers as profits soar. Successes like this one increase China's footprint across Southeast Asia. Chinese firms have been coming here for over a decade, but that is now accelerating. Around 90% of all garment factories in this country are now Chinese run or Chinese owned. President Trump's tariffs have not stopped China's rise. Beijing has simply gone elsewhere to do business. Bound crates now ship from Cambodia as China navigates its way through this trade war. It may be losing some money in this battle, but it is gaining power and influence. Laura Bicker, BBC news, Phnom Penh.