Trump threatens 30% tariffs on Mexico, European Union from August 1

President Donald Trump said he will impose 30 per cent tariffs on imports from Mexico and the European Union starting August 1, a move that would escalate trade tensions with two of the United States’ most significant economic partners.

In two separate letters posted Saturday (July 12) morning on Truth Social, Trump accused Mexico of “failing to stop the Cartels” and signalled his frustration with ongoing trade negotiations with the EU.

The tariff threats add to a volatile week in global trade, during which the president has targeted more than 20 countries with new or increased levies. He has also announced forthcoming 50 per cent tariffs on copper, further unsettling markets already reacting to his aggressive trade agenda.

EU caught off guard despite talks

The letter to the EU echoed recent communications in which Trump warned of further punitive measures. Despite weeks of efforts by European officials traveling between Brussels and Washington to negotiate a deal, Trump has shown little sign of easing up.

The two sides had been discussing potential reductions to existing tariffs, including a 25 per cent levy on vehicles and related parts. An agreement under discussion could have eliminated duties on aircraft, spirits, and industrial components.

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The EU has offered to narrow its €198 billion trade surplus in goods with the United States by increasing purchases of American liquefied natural gas and defence equipment. However, those overtures have not prevented the new 30 per cent tariff threat.

Trump’s administration has already implemented significant duties, including a 25 per cent tariff on EU steel and aluminum, and a 10 per cent baseline tariff on most goods.

So far, Brussels has not retaliated with tariffs of its own, though officials have warned they are preparing countermeasures if the US proceeds.

Mexico faces renewed pressure despite exemptions

Mexico, which has already been targeted alongside Canada earlier this year with 25 per cent tariffs over issues related to immigration and fentanyl trafficking, is once again in Washington’s crosshairs.

Trump had earlier exempted most Mexican exports from the harshest levies under the terms of the 2020 United States-Mexico-Canada Agreement (USMCA). Between January and March, about 87 per cent of Mexican goods entered the US tariff-free, Financial Times reported citing Mexico’s economy ministry

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The new 30 per cent tariff, however, raises concerns that exemptions under the USMCA may not be enough to shield Mexico’s export economy from further disruption. Trump’s messaging suggests a growing frustration with what he perceives as inadequate enforcement on Mexico’s side of the border.

In addition to the announced tariffs, the administration has launched national security investigations that could result in new duties on semiconductors, aerospace parts, pharmaceuticals, lumber, and consumer electronics.

These investigations signal the administration’s willingness to expand its tariff regime beyond traditional trade disputes, and into sectors critical to global supply chains.

The prospect of fresh levies on two of the US’s largest trading partners introduces further uncertainty into global markets, with companies and governments watching closely to see if the threats materialise by the August 1 deadline.

With inputs from agencies