Today, President Trump held the first Cabinet meeting of his second term, in which he discussed a range of subjects including upcoming and new trade action. During the meeting, Commerce Secretary Lutnick noted that tariff action against Canada and Mexico related to illegal immigration and fentanyl, and reciprocal trade action was expected to go forward, but the timeline is not completely clear. President Trump also noted possible 25% tariffs against EU imports. Finally, as the Cabinet meeting was taking place, Jamieson Greer was confirmed by the Senate as USTR.
There is not a lot of additional information or clarity on some of the issues discussed in the Cabinet meeting but see below a more detailed summary of information.
Potential Canada and Mexico Tariffs
- During the Cabinet meeting, Lutnick noted that the United States is still on track to implement 25% tariffs on imports from Mexico and Canada by the 4 March deadline. Lutnick also emphasized that it was up to Canada and Mexico to convince President Trump that they have taken sufficient action to stem the flow of illegal immigrants and fentanyl to warrant not imposing the tariffs.
- President Trump reported that while there’s been a 90% decrease in illegal immigration at the border, the reduction was primarily a result of US action and not action by Canada or Mexico. By attributing results to U.S. action, it is not clear if President Trump feels that enough has been done by Canada and Mexico to further delay or rescind tariff action.
- Despite Lutnick’s remarks, the timeline for implementation of tariffs against USMCA member countries is unclear as President Trump also indicated that tariffs would be implemented on 2 April, not the earlier deadline of 4 March.
Potential EU Tariffs
- President Trump’s comments on trade during the Cabinet meeting included the announcement of 25% tariffs on imports from the EU-27. He indicated the tariffs would be applied “generally” but also specifically mentioned hitting auto imports.
- Scope of tariffs is not yet available, and it is not clear if specific EU Member States would be targeted and/or if packaging machinery would be included in products subject to the additional tariff.
Greer Confirmed as USTR
- Today, the Senate confirmed Jamieson Greer to serve as the next USTR.
- Ambassador Greer was present at the Cabinet meeting during the confirmation vote, but did not seem to speak during the meeting. It was Secretary Lutnick who spoke on U.S. trade and tariff policy, further indicating that USTR is likely not going to be leading trade/tariff action policy during the second Trump Administration.
