Donald Trump has pulled back from the brink of a trade war with Canada and Mexico, postponing sweeping new US tariffs on goods from its two closest economic partners by one month.
It is the third time in two weeks the US president has delayed his threatened 25% tariffs on the two countries. China is still set to face additional 10% levy on its exports to the US from Tuesday.
Following talks with the Canadian prime minister, Justin Trudeau, and the Mexican president, Claudia Sheinbaum, on Monday, Trump agreed to hold off from imposing new duties on the two countries.
The agreements came on a day of extreme volatility in global financial markets as rattled investors reacted to the prospect of a dramatically escalating dispute involving the world’s largest economies.
The US president had upended US-Mexico ties over the weekend when he announced 25% tariffs and accused Sheinbaum’s administration of engaging in an “intolerable alliance” with Mexican crime groups.
Sheinbaum rejected that “slanderous” accusation, but on Monday morning struck a softer note as she announced “a series of agreements” with Trump after a conversation between the two leaders during which they agreed to pause US tariffs for a month to allow for fresh negotiations.
Mexico had agreed to send 10,000 members of its national guard “to prevent drug trafficking from Mexico to the US, in particular of fentanyl”, Sheinbaum said. In return, the US had agreed to work to prevent high-powered weapons crossing the border into Mexico.
Trump confirmed the deal shortly afterwards on his Truth Social network. He said 10,000 Mexican soldiers would be “specifically designated to stop the flow of fentanyl, and illegal migrants into our country”.
Negotiations involving senior Mexican officials, the US secretary of state, Marco Rubio, the US treasury secretary, Scott Bessent, and the US commerce secretary, Howard Lutnick, would take place during the pause, he said.
Following two calls with Trump on Monday, Trudeau announced that tariffs would be “paused” for 30 days. “Canada is implementing our $1.3bn border plan – reinforcing the border with new choppers, technology and personnel, enhanced coordination with our American partners, and increased resources to stop the flow of fentanyl,” he said in a statement. “Nearly 10,000 frontline personnel are and will be working on protecting the border.”
Late last year, Trump threatened to impose tariffs on Canada, Mexico and China on the first day of his presidency. From the first day of his presidency, he said he would do so from 1 February. This weekend, he said they would kick in from 4 February. They have now been delayed until March.
Economists have warned Trump’s planned wave of tariffs would risk raising prices for millions of Americans, just weeks after he pledged, upon taking office, to “rapidly” bring them down.
On Monday, however, Trump maintained that tariffs were a “very powerful” means of both strengthening the US economically and “getting everything else you want”. He had conceded over the weekend that they could cause “a little pain” in the US.
Markets sold off sharply worldwide in response to what has been described as a “Trump tariff tantrum” before recovering some of their losses after news broke of the deal with Mexico. Wall Street fell in early trading, with the S&P 500 down almost 2%. Share prices in Europe followed a sharp move lower in Asia.
London’s FTSE 100 index dropped 1.4% from Friday’s record high before making back some of its losses to trade down 1%.
Trump also indicated on Sunday that the EU would be next to face tariffs, but did not say when.
EU leaders meeting at an informal summit in Brussels on Monday said Europe would fight back if the US imposed tariffs, but called for negotiation. The French president, Emmanuel Macron, said that if the bloc’s commercial interests were attacked it would “make itself respected and thus react”.
The German chancellor, Olaf Scholz, said the EU could respond if necessary with its own tariffs, but stressed it would be better for the two sides to find agreement on trade.
Trump hinted that Britain might be spared tariffs, saying: “I think that one can be worked out.”
Asked whether he was worried by Trump’s refusal to rule out imposing sanctions on the UK, the country’s prime minister, Keir Starmer, said: “Obviously, it’s early days.
“I think what’s really important is open and strong trading relations and that’s been the basis of my discussions with President Trump. I know that intense US-EU discussions are planned.”
Officials, analysts and economists who believe Trump’s tariffs could have disastrous consequences for the global economy and for Washinton’s place in the world voiced relief at the Mexico deal.
Experts believe Trump’s plans for 10% tariffs on China and 25% on Canada and Mexico would hamper global growth and cause inflation in the US. Even Trump admitted on Sunday that the measures might cause “a little pain”.
Brian Winter, the editor-in-chief of Americas Quarterly magazine and a Latin America expert, said: “I don’t think anyone expected a resolution today, and obviously it’s a relief. But the damage is done.
“I can personally imagine a scenario where, within a year, President Trump is on buddy-buddy terms again with Mexico. But you cannot unsee what happened over the last 48 hours. And if companies make decisions in terms of years and decades, how they think about Mexico specifically, and its place in the US value chain, is forever changed.”
Speaking at her daily press conference in Mexico City, Sheinbaum told reporters that at the end of a 30- to 45-minute conversation with Trump, she had joked with him that she would like to see tariffs suspended forever. She said she believed a one-month reprieve represented a good deal, however, and painted the agreement as a win for both sides.
“In Mexico we have rocket launchers that come from the US illegally … How can these high-powered weapons get into Mexico from the US?” she asked, hailing Trump’s apparent commitment to fight gun smuggling as part of the agreement.
Winter said he believed that in some ways Trump’s strong-arm tactics appeared to be working.
Four of his opening moves on the world stage have come in Latin America: diplomatic tussles with Colombia and Venezuela over the deportation of migrants; with Mexico over drug trafficking and migration; and with Panama over supposed Chinese involvement in the Panama canal. In all four cases, Trump has managed to claim victory or extract concessions, although critics argue many of those are largely cosmetic and designed to achieve little more than to please his base.
Winter said: “There’s no doubt that Trump’s approach has produced tangible short-term results in Latin America, decisions that were made with a scope and timeline that otherwise would not have been possible … I think you have to acknowledge that each of these governments have moved far more quickly to accommodate Washington than they would have under a more traditional request.
“The question is, though: what does this do to Washington’s alliances in the medium term? Does it push these countries closer to China? I have my doubts … but with all of these crises, scars remain. I think that governments understand that this is an even more transactional government than in Donald Trump’s first term, and that they can’t really think in terms of alliances anymore with the United States. That’s a huge change.”
The Trump administration has announced that they will be postponing the imposition of tariffs on Canadian and Mexican goods for an additional month. This decision comes after ongoing negotiations between the three countries to address various trade issues.
President Trump had previously threatened to impose tariffs on all goods coming from Mexico in an effort to curb illegal immigration. However, after reaching a deal with Mexico to increase border security measures, the tariffs were put on hold.
Similarly, tariffs on Canadian steel and aluminum were also being considered, but have been delayed once again to allow for further discussions.
This latest development is seen as a positive step towards resolving trade disputes with two of the United States’ biggest trading partners. Stay tuned for more updates on this developing story.
Canada’s Prime Minister Justin Trudeau looks on during a press conference while responding to U.S. President Donald Trump’s orders to impose 25% tariffs on Canadian imports, in Ottawa, Ontario, Canada February 1, 2025.
Patrick Doyle | Reuters
President Donald Trump on Monday agreed to pause the implementation of planned tariffs on imports from Canada for at least 30 days, Canadian Prime Minister Justin Trudeau said.
The pause was announced in a tweet by Trudeau hours after Trump and Mexico’s president said Trump would pause for one month planned tariffs on imports from Mexico.
Trump on Saturday said he would impose 25% tariffs on goods from Mexico and Canada, and 10% tariffs on goods imported from China. Trump had also planned to impose a 10% tariff on energy resources from Canada.
Trudeau in his tweet said, “I just had a good call with President Trump,” and suggested that the pause on tariffs was in response to Canada’s agreement to target the flow of the deadly opioid fentanyl across the border into the United States.
Trump’s pause on tariffs on Mexican imports likewise came after Mexico President Claudia Sheinbaum said she would immediately send 10,000 soldiers to the U.S. border to prevent drug trafficking, fentanyl in particular, from Mexico.
Trudeau said Canada had made new commitments “to appoint a Fentanyl Czar,” among other measures.
“Proposed tariffs will be paused for at least 30 days while we work together,” Trudeau wrote.
Trump soon after followed up with a post on Truth Social.
“Canada has agreed to ensure we have a secure Northern Border, and to finally end the deadly scourge of drugs like Fentanyl that have been pouring into our Country, killing hundreds of thousands of Americans, while destroying their families and communities all across our Country.”
“I am very pleased with this initial outcome, and the Tariffs announced on Saturday will be paused for a 30 day period to see whether or not a final Economic deal with Canada can be structured,” Trump wrote. “FAIRNESS FOR ALL!”
This is breaking news. Please refresh for updates.
In a recent development, President Trump has announced that he will be pausing tariffs on Canada for at least 30 days. This decision comes after a meeting between Trump and Canadian Prime Minister Justin Trudeau, where they discussed the ongoing trade tensions between the two countries.
Trudeau has welcomed this decision, stating that it is a positive step towards resolving the trade dispute and maintaining a strong economic relationship between Canada and the United States. He emphasized the importance of working together to address trade issues in a fair and mutually beneficial manner.
The temporary pause on tariffs will provide both countries with an opportunity to continue negotiations and find a long-term solution to their trade disagreements. It is hoped that this period of reflection will lead to a more constructive and productive dialogue between the two nations.
Overall, this development represents a positive development in the trade relationship between Canada and the United States, and offers hope for a more stable and prosperous future for both countries. Let’s hope that the next 30 days will bring about meaningful progress towards a resolution of the trade dispute.
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Trump tariffs, Canada, Trudeau, trade, economy, US-Canada relations, international trade, politics, Trump administration, North American economy, tariffs on Canada, trade negotiations
President Donald Trump told reporters that he plans to speak with Canadian Prime Minister Justin Trudeau on Monday morning, less than a day before the US’ tariffs on the country are scheduled to go into effect.
Trudeau said Saturday he’d been trying to reach Trump since the inauguration, but his calls have not been returned.
Trump announced over the weekend that tariffs will amount to a significant 25% duty on all imports from Mexico and most goods from Canada, and a 10% tariff on Chinese goods imported into the United States. The three countries soon announced they would take retaliatory measures.
On Sunday evening, Trump also threatened to enact additional tariffs on the European Union — accusing the EU of being “really out of line.”
“They don’t take our cars, they don’t take our farm products. They take almost nothing, and we take everything from them, millions of cars, tremendous amounts of food and farm products,” Trump said.
Fact check: It’s not true that the EU doesn’t buy US farm products. The US government says the EU bought $12.3 billion worth of US agricultural exports in the 2023 fiscal year, making it the fourth-largest export market for US agricultural and related products.
And according to a December 2023 report from the European Automobile Manufacturers’ Association, the EU is the second-largest market for US vehicle exports — importing 271,476 US vehicles in 2022, valued at nearly 9 billion euro.
As the Trump administration continues to make headlines with its latest policies and actions, stay informed with live updates on tariffs, executive actions, and immigration news. Join us as we track the latest developments and provide analysis on how these decisions could impact the economy, trade relations, and immigration policies. Stay tuned for up-to-the-minute coverage on all things Trump-related. #Trump #tariffs #executiveactions #immigrationnews #updates
The U.S. and Mexico reached an agreement Monday to delay a 25% tariff on all Mexican imports for one month, after Mexico agreed to ramp up security at its border — averting, at least for now, a move that could have driven up prices for U.S. consumers and stalled both countries’ economies.
Mexican President Claudia Sheinbaum posted on social media that Mexico will immediately reinforce the northern border with 10,000 members of the National Guard to address drug trafficking from Mexico into the U.S., particularly fentanyl.
Trump said in his own post on social media that the U.S. will continue negotiations with Mexico over border security, headed by Secretary of State Marco Rubio, Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick.
The move came after Trump signed an executive order Saturday toplace a 25% tariff on nearly all goods coming into the U.S. from Canada and Mexico starting on Tuesday.
Stocks fell in response to the tariffs, as economists and business executives warned they could raise prices in the U.S. and trigger an economic slowdown. The U.S. imports more goods from Mexico than any other country.
During his first term, Trump had also threatened to place tariffs on Mexico, before backing away several days later when Mexico responded with plans to increase border security.
Trump also said on social media that he had spoken with Canadian Prime Minister Justin Trudeau Monday morning and would speak with him again in the afternoon.
Since the announcement on Saturday, administration officials and Trump have shared mixed messages about the intention of the tariffs and what steps would need to be taken to have them lifted.
The White House said in the executive order issuing the tariffs that the move was in response to the flow of fentanyl and immigrants coming into the country from Canada and Mexico, which Trump was declaring a national emergency. Under the International Emergency Economic Powers Act, the president has authority over trade in a national emergency.
But in several social media posts over the weekend, Trump seemed to contradict that rationale, instead citing a trade deficit with the three countries and calling on companies to make their products in America. In another posting, Trump said the tariffs would pressure Canada to join the U.S.
“We pay hundreds of Billions of Dollars to SUBSIDIZE Canada. Why? There is no reason. We don’t need anything they have. We have unlimited Energy, should make our own Cars, and have more Lumber than we can ever use. Without this massive subsidy, Canada ceases to exist as a viable Country. Harsh but true! Therefore, Canada should become our Cherished 51st State. Much lower taxes, and far better military protection for the people of Canada — AND NO TARIFFS!” Trump said on Truth Social.
Administration officials went on cable news this morning to reiterate that the move was about drugs and immigration and accused Canada of misunderstanding the intention of the tariffs.
“This isn’t a ‘trade war’ with Canada, or Mexico, or China — this is about fentanyl,” said Interior Secretary Douglas Burgum on Fox News. “We’ve had a mass invasion of our country.”
Shannon Pettypiece is senior policy reporter for NBC News.
Garrett Haake contributed.
In a recent development, President Trump and Mexico’s President have announced that the proposed tariffs on Mexican goods will be delayed for one month following successful talks between the two countries. This decision comes as a relief to many, as the tariffs were set to go into effect on Monday.
During the talks, both leaders discussed ways to address the issue of illegal immigration and find a solution that is mutually beneficial. While the details of the agreement have not been made public, both parties have expressed optimism about the progress made during the discussions.
This news has been met with cautious optimism by investors and businesses who were concerned about the potential impact of the tariffs on the economy. It remains to be seen whether a long-term solution can be reached, but for now, it seems that both sides are willing to continue the dialogue in order to avoid further economic disruption.
Overall, this development highlights the importance of diplomacy and negotiation in resolving complex issues between countries. It is a positive step towards finding a peaceful resolution to the immigration crisis and avoiding unnecessary economic strain on both nations.
Mexico’s President Claudia Sheinbaum gestures as she speaks about U.S. President Donald Trump’s policies during a press conference at the National Palace, in Mexico City, Mexico January 21, 2025. REUTERS/Henry Romero
Henry Romero | Reuters
President Donald Trump on Monday said that he will pause for one month his new 25% tariff on goods entering the United States from Mexico after Mexican President Claudia Sheinbaum agreed to immediately send 10,000 soldiers to her country’s northern border to prevent drug trafficking.
The announcement of the pause came two days after Trump slapped 25% tariffs on goods from Mexico and Canada, as well as a 10% tariff on goods imported from China.
Trump said in a social media post that he and Sheinbaum spoke Monday morning.
“We further agreed to immediately pause the anticipated tariffs for a one month period during which we will have negotiations headed by Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, and Secretary of Commerce Howard Lutnick, and high-level Representatives of Mexico,” Trump wrote in the post.
“I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a ‘deal’ between our two Countries,” Trump wrote.
Scott Bessent and Marco Rubio arrive ahead of the 60th inaugural ceremony where Donald Trump will be sworn in as the 47th president on January 20, 2025, in the US Capitol Rotunda in Washington, DC.
Ricky Carioti | The Washington Post | Getty Images
Sheinbaum had first disclosed the pause in a post on the X social media site.
“We had a good conversation with President Trump with great respect for our relationship and sovereignty; we reached a series of agreements,” Sheinbaum wrote in the tweet, according to a translation from Spanish.
She also wrote, “The United States is committed to working to prevent the trafficking of high-powered weapons to Mexico.”
This is breaking news. Please refresh for updates.
In a recent turn of events, President Trump has decided to pause his plan to impose tariffs on Mexico after reaching an agreement on border security. The tariffs, which were set to go into effect on Monday, have been postponed for at least 90 days as both countries work towards finding a solution to the immigration crisis.
This decision comes after Mexico agreed to deploy thousands of National Guard troops to their southern border in an effort to curb the flow of migrants heading towards the United States. The two countries will also continue discussions on other measures to address the issue, including potential changes to asylum laws and increased cooperation on regional economic development.
While some critics have questioned the effectiveness of using tariffs as a leverage tool in international negotiations, others see this as a positive development in the ongoing efforts to secure the border and address the immigration challenges facing both countries.
As the situation continues to evolve, it remains to be seen how this temporary truce will impact the broader relationship between the United States and Mexico. Stay tuned for more updates on this developing story.
Indian benchmark indices ended in the red on Monday, with heavyweights Reliance Industries and Larsen & Toubro leading declines on the benchmarks, mirroring losses in regional markets after U.S. President Donald Trump’s sweeping tariffs on Canada, Mexico, and China fueled fears of an escalating trade war.
The benchmark BSE Sensex lost 319.22 points or 0.41% to close at 77,186.74, while the broader Nifty 50 index closed at 23,361.05, lower by 121.10 points or 0.52%.
The market capitalization of all listed companies on the BSE decreased by Rs 5.30 lakh crore to Rs 419.49 lakh crore.
Factors
1) Trump tariffs trigger trade war fear
The decline follows Trump’s decision to impose tariffs on Canada, Mexico, and China over the weekend, sparking concerns about the potential impact on global growth.
Trump followed through with threats to slap Canada and Mexico with duties of 25% and China with a 10% levy at the weekend, calling them necessary to combat the flow of migrants and fentanyl into the U.S.In response, Canada and Mexico immediately vowed retaliatory measures, while China announced plans to challenge the tariffs at the World Trade Organization. The tariffs, outlined in three executive orders, are set to take effect on Tuesday.2) US dollar at record peak
The US dollar shot to a record peak against the Chinese yuan in offshore trading, and its highest against Canada’s currency since 2003 and the strongest against the Mexican peso since 2022.
Meanwhile, the Indian rupee weakened past Rs 87 per US dollar for the first time on Monday, following Trump’s tariff impositions on the country’s largest trading partners, which drove a surge in the US dollar.
“For now, India is not affected. Therefore, the impact on the Indian market will be less. But the spike in the dollar index to above 109.6 will trigger more selling by FIIs putting the market under pressure,” said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
3) US treasury yields rise
US two-year Treasury yields rose by as much as 3.6 basis points to 4.274%, hitting a one-week high, amid concerns that tariffs could stoke US inflation and delay interest rate cuts. This rise in US Treasury yields is negative for emerging economies like India, as higher US yields typically attract capital flows away from riskier assets in emerging markets, leading to currency depreciation and higher borrowing costs.
4) Technical indicator
Akshay Chinchalkar, Head of Research at Axis Securities, said, “Today is most likely going to be a gap-down given the selloff in US equity futures and regional equities including the Gift Nifty on the tariff announcement. Immediate support stands in the 23246 – 23267 zone followed by an extension in the 23108 area, with near-term resistance coming into play between 23632 and 23657.”
“Meanwhile, the weekly chart traced a “bullish engulfing” formation inside the Ichimoku cloud, the first time that’s happened since March ’22. Still, expect more than average volatility in the month of February, given that based on two decades of data, the nifty has produced the worst returns in the month, losing 1% on average,” Chinchalkar added.
5) Jump in oil prices
Oil prices surged following the announcement of US tariffs, which raised concerns about potential crude supply disruptions from two of the biggest suppliers to the US However, the prospect of lower fuel demand capped the gains.
US West Texas Intermediate (WTI) crude futures were trading at $73.97 a barrel, up $1.44, or 2%, by 0042 GMT, after hitting a week-high of $75.18 a barrel earlier in the session. Brent crude futures rose 62 cents, or 0.8%, to $76.29 a barrel, after touching a high of $77.34.
With inputs from agencies
The Indian stock market witnessed a massive 319-point drop in the Sensex and Nifty dropping below 23,400, wiping out a staggering Rs 5.3 lakh crore in market value. Among the top five factors behind this downfall, Trump’s tariffs have played a significant role.
President Donald Trump’s unpredictable trade policies have created uncertainty in the global markets, leading to increased volatility and investor nervousness. The recent escalation in the US-China trade war and the imposition of tariffs on various goods have added to the fears of a global economic slowdown.
The Indian markets, being highly interconnected with the global economy, have felt the impact of these tariffs. Investor sentiment has been dampened, leading to a sell-off in stocks across various sectors. The automotive, IT, and metals sectors have been hit particularly hard, with many companies seeing a sharp decline in their stock prices.
Other factors contributing to the market downfall include rising crude oil prices, weak corporate earnings, and concerns over the economic slowdown. The combination of these factors has created a perfect storm, causing the markets to tumble and erasing billions of rupees in market value.
Investors are advised to remain cautious in the current volatile market environment and to diversify their portfolios to mitigate risks. The coming days will be crucial as global trade tensions continue to escalate, and market participants brace for further turbulence.
Canada’s Ontario on Monday banned US firms from government contracts in a move that will scrap $100-million deal with Elon Musk‘s Starlink. Doug Ford, premier of Ontario, said the ban would persist unless the Trump administration lifts recently imposed tariffs on Canada. Last year, the Doug dispensation had inked an agreement with Musk, who is a key part of the Trump government, to deliver high-speed internet to remote residents in rural and northern Ontario. “Every year, the Ontario government and its agencies spend $30 billion on procurement, alongside our $200 billion plan to build Ontario. US-based businesses will now lose out on tens of billions of dollars in new revenues. They only have President Trump to blame. We’re going one step further. We’ll be ripping up the province’s contract with Starlink. Ontario won’t do business with people hellbent on destroying our economy. Canada didn’t start this fight with the U.S., but you better believe we’re ready to win it,” the Ontario premier wrote on X.
Earlier, Ford announced that his officials would soon be removing American products from provincial liquor store shelves. His statement came a day after British Columbia Premier David Eby announced that the local authority will stop buying liquor from US Republican states. Canada’s move is in retaliation to Trump’s sweeping new tariffs on imports from Canada, Mexico and China, a move that has triggered sharp reactions from global leaders and financial markets. The tariffs, which Trump says are aimed at protecting American workers and industries, have sparked fears of economic retaliation from affected countries. Meanwhile, Trump said that he would talk to Trudeau at 3.00 PM about drug pouring through the borders of Canada. “Canada doesn’t even allow U.S. Banks to open or do business there. What’s that all about? Many such things, but it’s also a DRUG WAR, and hundreds of thousands of people have died in the U.S. from drugs pouring through the Borders of Mexico and Canada. Just spoke to Justin Trudeau. Will be speaking to him again at 3:00 PM,” Trump said on his social media platform Truth Social.
In response to President Trump’s recent tariffs on Canadian goods, the province of Ontario has announced a ban on all US-based companies and has decided to cut ties with Elon Musk’s Starlink project. This move comes as a retaliation to the escalating trade war between the two countries, with Ontario officials citing the need to protect their own economy and interests.
The decision to ban US firms and sever ties with Starlink has sparked controversy and debate within the province, with some critics claiming that the move will only serve to further damage the already strained relationship between Canada and the US. However, Ontario officials have stood by their decision, stating that they will not stand idly by while their economy suffers as a result of Trump’s tariffs.
The trade war between the US and Canada shows no signs of slowing down, and Ontario’s bold stance against US companies is just the latest development in what could be a long and tumultuous battle. As tensions continue to rise, it remains to be seen how this trade war will ultimately impact both countries and the global economy as a whole.
The leader of Canada’s most populous province of Ontario says he’s ripping up a contract with Elon Musk’s Starlink internet services in response to Donald Trump’s sweeping tariffs on Canada, as well as banning American companies from provincial contracts
TORONTO — The leader of Canada’s most populous province of Ontario said Monday he’s ripping up a contract with Elon Musk’s Starlink internet services in response to U.S. President Donald Trump’s sweeping tariffs on Canada.
Ontario Premier Doug Ford, who said he is also banning American companies from provincial contracts, signed a $100-million Canadian (US$68 million) with Musk’s company in November to deliver high-speed internet to remote residents in rural and northern Ontario.
“We’ll be ripping up the province’s contract with Starlink. Ontario won’t do business with people hellbent on destroying our economy,” Ford said in a post on X.
Ford said starting Tuesday and until U.S. tariffs are removed, Ontario will ban American companies from provincial contracts.
“Canada didn’t start this fight with the U.S., but you better believe we’re ready to win it,” said Ford, who called an election for his province last week.
In a bold move, Ontario Premier Doug Ford announced today that he will be “ripping up” the contract with Elon Musk’s Starlink satellite internet service in response to new tariffs imposed on Canadian exports.
The decision comes as a response to the recent announcement by the United States to impose tariffs on Canadian steel and aluminum products, a move that has sparked outrage and concern among Canadian politicians and industry leaders.
Premier Ford stated that the tariffs are “unfair and unjust” and that he will not stand idly by while Ontario businesses and workers are harmed by these punitive measures. He also emphasized that he will not allow Musk’s company to profit off the backs of hardworking Ontarians while their livelihoods are threatened by the tariffs.
The decision to terminate the contract with Starlink is sure to have far-reaching consequences, as the satellite internet service was seen as a potential solution to rural connectivity issues in the province. However, Premier Ford remains steadfast in his commitment to defending Ontario’s interests and standing up to what he sees as unjust trade practices.
This move is just the latest in a series of aggressive actions taken by the Ontario government in response to the tariffs, and it is unclear what the future holds for the province’s relationship with Musk’s company. Only time will tell how this decision will impact Ontario’s internet infrastructure and the broader economic implications of the tariffs.
Progressive Conservative Leader Doug Ford is “ripping up” Ontario’s nearly $100 million contract with Elon Musk’s Starlink in the wake of U.S. tariffs on virtually all Canadian goods, he said in a statement Monday.
The contract, signed in November, was meant to provide high-speed internet access through Starlink’s satellite service to 15,000 eligible homes and businesses in rural, remote and northern communities by June of this year.
“Ontario won’t do business with people hellbent on destroying our economy,” Ford said in the statement.
Ford said Ontario will ban American companies from provincial contracts until U.S. tariffs are removed.
“U.S.-based businesses will now lose out on tens of billions of dollars in new revenues. They only have President Trump to blame,” he said.
On Saturday, U.S. President Donald Trump imposed 25 per cent tariffs on virtually all goods from Canada and a lower 10 per cent tariff on Canadian energy products
Musk, an adviser to Trump, is overseeing the U.S. Department of Government Efficiency (DOGE) in co-operation with the president’s administration.
Ford has faced criticism for the contract, with Ontario Liberal Leader Bonnie Crombie calling on him to end the deal last week.
“If he were serious about standing up to Trump, he would cancel his sweetheart deal with Elon Musk,” Crombie previously said in a news release.
Ford defended the contract at the time, saying there was a transparent bidding process and it was part of the government’s plan to get everyone in the province high-speed internet.
Starlink growing quickly in Canada
According to a news release from Infrastructure Ontario in January 2024, only two satellite internet service providers could meet the province’s needs.
Those were Musk’s SpaceX, which runs Starlink, and Xplore Inc., a Canadian rural internet service provider. Both providers were invited to participate in a bidding process, the release said, with SpaceX ultimately winning out.
Starlink surpassed Xplornet, operated by Xplore Inc., as the leading satellite-based provider of rural and remote internet access service in Canada in 2022, according to a report by the Global Media and Internet Concentration Project in December.
As of 2024, Starlink has around 400,000 subscribers in Canada, the report said.
In a shocking turn of events, Ford announced today that they will be “ripping up” their $100 million contract with Elon Musk’s Starlink in Ontario. This decision comes in the wake of new U.S. tariffs that have significantly increased the cost of importing Starlink’s satellite technology.
The contract, which was originally signed in hopes of providing high-speed internet to rural areas in Ontario, has now become financially unfeasible for Ford due to the added costs of the tariffs. In a statement released by the company, Ford expressed their disappointment in having to cancel the contract, but emphasized that they must prioritize the financial well-being of their business.
This move is sure to have significant implications for both Ford and Starlink, as they now must find alternative solutions to provide internet access to underserved communities in Ontario. It remains to be seen how this decision will impact the future of Elon Musk’s ambitious satellite internet project.
Stay tuned for more updates on this developing story.
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Ontario $100M deal scrapped by Ford
Elon Musk’s Starlink contract terminated by Ford
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U.S. tariffs impact on Ford-Starlink deal
Ontario contract cancellation with Elon Musk’s Starlink
Ford’s move to rip up $100M Starlink contract
Implications of Ford’s decision on Starlink deal
Ford’s response to U.S. tariffs on Starlink contract
Ontario’s contract with Starlink terminated by Ford
The US dollar (DX=F, DX-Y.NYB) is on track to secure its best week since mid-November as a looming tariff deadline pushes the greenback currency to new heights.
The US Dollar Index, which measures the dollar’s value relative to a basket of six foreign currencies — the euro, Japanese yen, British pound, Canadian dollar, Swedish krona, and Swiss franc — rose about 0.5% on Friday to rebound from its worst performance in over a year last week.
The index has gained around 8% since its September lows and is up about 5% since Election Day.
The dollar’s price action has largely been driven by two main catalysts: President Trump’s election and the subsequent Republican sweep, along with the recalibration of future Fed easing in the face of strong economic data.
But the unknown of Trump’s tariff policy has been the biggest driver in recent weeks and looks set to remain that way in the months ahead.
“In case there was any lingering doubt, investors are judging tariffs to be a dollar-positive, as we had anticipated,” Capital Economics senior markets economist James Reilly wrote in a note published on Friday.
But “for all the attention tariffs have received in recent months, they are far from priced in,” he warned.
According to Reilly, elevated volatility in currency markets reflect traders “appear to be bracing for something,” but also said they seem reluctant to take Trump at his word.
“That’s a key reason why we think the dollar still has a bit more upside if, as remains our working assumption for now, a 10% universal tariff and 60% levy on imports from China are imposed around Q2,” he said.
The stock market took a hit on Friday as President Trump announced plans to move forward with imposing tariffs on Chinese goods. The Dow Jones Industrial Average, S&P 500, and Nasdaq all stumbled as investors reacted to the news.
Trump’s decision to recommit to imposing tariffs on Saturday came after talks with Chinese officials failed to reach a resolution. The move is expected to escalate tensions between the world’s two largest economies, potentially leading to a trade war.
Investors are concerned about the impact that tariffs could have on the global economy, as they could lead to higher prices for consumers and disrupt supply chains. The uncertainty surrounding trade relations between the US and China has been a major source of volatility in the markets in recent months.
As a result of Trump’s announcement, the Dow Jones Industrial Average dropped by over 300 points, while the S&P 500 and Nasdaq also saw significant losses. The news has left investors on edge, as they wait to see how China will respond to the US tariffs.
Overall, the stock market is facing increased uncertainty and volatility as a result of Trump’s decision to recommit to imposing tariffs on Chinese goods. Investors will be closely watching how the situation unfolds in the coming days and weeks.
US President Donald Trump (File photo)
